Working Paper: NBER ID: w17341
Authors: Lucas W. Davis; Catherine Wolfram
Abstract: For the first four decades of its existence the U.S. nuclear power industry was run by regulated utilities, with most companies owning only one or two reactors. Beginning in the late 1990s electricity markets in many states were deregulated and almost half of the nation's 103 reactors were sold to independent power producers selling power in competitive wholesale markets. Deregulation has been accompanied by substantial market consolidation and today the three largest companies control more than one-third of all U.S. nuclear capacity. We find that deregulation and consolidation are associated with a 10 percent increase in operating efficiency, achieved primarily by reducing the frequency and duration of reactor outages. At average wholesale prices the value of this increased efficiency is approximately $2.5 billion annually and implies an annual decrease of almost 40 million metric tons of carbon dioxide emissions.
Keywords: No keywords provided
JEL Codes: D21; D40; L51; L94; Q48
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| deregulation and consolidation (L51) | increase in operating efficiency (L23) |
| divestiture (G34) | increase in efficiency (D61) |
| increase in operating efficiency (L23) | reduction in reactor outages (L94) |
| increase in operating efficiency (L23) | reduction of carbon dioxide emissions (Q54) |
| deregulation and consolidation (L51) | reduction of carbon dioxide emissions (Q54) |
| divestiture (G34) | decrease in emergency shutdowns (L94) |