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OPEN ACCESS AND THE EMERGENCE OF A COMPETITIVE NATURAL GAS MARKET
Author(s) -
VANY ARTHUR DE,
WALLS W. DAVID
Publication year - 1994
Publication title -
contemporary economic policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.454
H-Index - 49
eISSN - 1465-7287
pISSN - 1074-3529
DOI - 10.1111/j.1465-7287.1994.tb00425.x
Subject(s) - natural gas , business , pipeline transport , pipeline (software) , industrial organization , economics , natural resource economics , international economics , commerce , environmental science , chemistry , engineering , mechanical engineering , organic chemistry , environmental engineering
Recent regulatory changes permitted natural gas pipelines to become “open access” transporters. This change in pipeline carrier status dissolved regulatory barriers to markets. This paper describes the institutions that were developed to support exchange in gas markets and observes and evaluates their emergence, evolution, and performance. The institutional and empirical evidence reveals that gas markets rapidly emerged with the dissolution of regulatory barriers. Spot gas prices converged and became highly correlated. A national market for natural gas developed within four years.