Reprint Number 142
Transmission Congestion Contracts and Strategic Behavior in Generation
Thomas-Olivier Nasser, The Electricity Journal, Vol. 11, No. 4, pp. 32-39, Copyright 1998, with permission from Elsevier Science

Capacity constraints on the transmission network - the key to achieving most of the economics benefits promised by restructuring - affect competition in electricity generation. Despite early speculation to the contrary, economic models are unable to predict whether imperfect competition in generation increases or reduces transmission congestion payments.