Returning Competition to the US Energy Market

Competition is the bedrock of the U.S. market economy. It fosters innovation, which leads to greater investment, which then, in turn, leads to more innovation. This cycle goes on and on and continually produces better products at more affordable prices for consumers across the country. And, as this cycle creates more consumers, it also creates more high-paying jobs for businesses and entrepreneurs. Competition alone turns the wheels of prosperity in the United States.

Unfortunately, when it comes to electricity, among the most important resources for American families, we have operated under a monopoly structure that has stifled innovation for years. Public utility companies, with basically no competition to speak of, charge exorbitant prices that would be unacceptable on an open market where price competition would rein them in. This leaves families with the choice between paying these higher prices or be forced to simply not power their home.

According to the Bureau of Labor Statistics (BLS), the electric bill accounts for nearly 10 percent of housing expenditures for homeowners and is the most expensive utility cost for American families. The study also found that housing expenditures are rapidly rising and families are spending less on other needs, such as food, because of it. This is clearly unacceptable.

There is actually a sad irony in all of this, as the beginning of the electricity market was defined by fierce competition between Thomas Edison’s low voltage direct currents and Nikola Tesla’s high voltage alternating currents. After impassioned cases being made to the public over years, the efficiency, and lower costs of Tesla’s approach won the day.

Today, consumers have no such options. That does not have to be the case for long, however.