By Section A: Group 6

The electricity market has traditionally seen the development of its vital infrastructure under a natural monopoly. The idea, probably valid in its time, was that electrification was a strategic asset for an economy and the nature of electricity production made it economic to have one entity build the power plants and develop the network of wires. We did not want multiple sets of wires from different companies running down our streets. And the large investments in power plants would enjoy great economies if we could integrate their development with the expansion of the transmission network. In countries like the United States, vertically integrated monopolies were fostered under government regulation. In other countries, like England, the government took on direct responsibility for managing the electricity industry. The flip side however has been that the many years of protection and government regulation has resulted in large, sometimes bloated, slow-moving institutions that were hostile to innovation. As a result, in a country like England (where the government owned many of the companies), the new mantra became privatization and marketization under the Thatcher regime. The idea was to break up the monopolies, sell off the assets, and rely on marke