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A central issue in the debate over restructuring the electric power industry is the extent to which the market should be open to competition. One aspect of this debate is whether competition ought to be restricted to the whole sale power market or be extended to final retail consumers. This report begins to explore the potential differences in economic efficiency between wholesale and retail competition in the electric power industry. The two market-structure scenarios are defined and the factors responsible for differences in efficiency are described. The report also contains an assessment of the relative importance of the factors and recommendations for pursuing further research

Relative efficiency benefits of wholesale and retail competition in electricity: An analysis and a research agenda