Bauer, Francisca, Bremberger, Christoph, Rammerstorfer, Margarethe: The Impact of Different Unbundling Scenarios on Concentration and Wholesale Prices in Energy Markets. 11. Symposium Energieinnovation, Graz, Österreich, 10.02.2010-12.02.2010
A recent highly disputed subject of the regulatory framework for energy markets in Europe is the unbundling of vertically integrated down- and upstream firms. While legal unbundling is already implemented in most countries and indisputable in its necessity for approaching regulatory aims, continuative models as ownership unbundling or the alternative of an independent system or transmission operator (ISO/ITO) are still ambiguous. Hence, this article contributes to the economic analyses of identifying the differences of these separate types of unbundling. Via simulation, we find that legal unbundling is most advantageous under Cournot competition, whereas the ISO/ITO alternative brings about the lowest prices in a market with Bertrand competition. Moreover, under Bertrand competition, no differences between legal unbundling and ownership unbundling can be identified.