Late 1990s American Essay, Research Paper

In the late 1990s Americans for the first time found themselves in the position of being able to choose an electricity provider, as the once staid and monopolistic electric utility industry entered an era of freewheeling competition and deregulation. In this book Richard F. Hirsh explains how and why this radical restructuring has occurred.

Hirsh starts by describing the successful campaign by utility managers in the first decade of the century to protect their industry from competition. The regulated system that emerged had the unanticipated consequence of endowing utility managers with great political and economic power. Seven decades later a series of largely unanticipated events, including the accumulated effects of technological stagnation, the 1973 energy crisis, and the rise of the environmental movement, undermined the managers’ control of the system. Many people began to question the utilities’ standing as “natural monopolies.” New players such as academics, environmental and consumer advocates, politicians, and potential competitors began to affect public perception of the industry. The once closed system came under increasing pressure to transform itself.

Hirsh follows the flow of power as this transformation occurred. He also examines the relationship between technological innovation and regulation, showing how new ideas such as cogeneration stimulated questions about the value of government oversight of the system. And he shows how the increasing prominence of such disparate ideas as conservation and energy efficiency and the societal value of free markets helped propel the system toward open competition. The new system is still in its infancy; Hirsh’s perceptive account of its birth will help readers think more rationally about its future.

The author, Richard F. Hirsh, [email protected] , December 14, 1999

Who should read this book and some surprising elements of it

Have you started wondering why you’re being inundated with phone calls and advertisements urging you to change your supplier of electricity? It’s due to the gradual deregulation and restructuring of the electric utility system that is sweeping the country. If you thought telecommunications deregulation had major consequences, wait until electricity restructuring becomes complete in the next decade.