Introduction

Power Generation, Transmission, and Use

Markets, Regulation, and Oversight

Impacts of Power Generation and Transmission

Looking Ahead

Appendices

CEIR Report Map

PPRP Home

Maryland Power Plants and the Environment (CEIR-18)

Chapter 3 Markets, Regulation, and Oversight

Traditionally in the U.S., the electricity system was dominated by regulated vertically integrated utilities, each operating its local generation, transmission, and distribution system. Following deregulation of other industries, such as telecommunications and air travel, in the 1990s, some states began to examine ways to restructure the electricity industry. California was the first state to begin restructuring its electricity sector, but suspended retail electric restructuring following the 2000-2001 electricity crisis in which electricity supplies were constrained and prices increased dramatically. Though the California experience caused some states to halt restructuring efforts, 15 other states, typically states characterized by high electricity prices, continued with their restructuring plans. This has led to a national electricity system landscape in which some states continue to operate under a traditional regulated regime and others have moved toward competitive generation at the retail level. In Maryland, the Electric Customer Choice and Competition Act of 1999 restructured the electric utility industry to functionally separate it into three distinct businesses:  generation and supply, transmission, and distribution.