Abstract
This chapter is dedicated to analysing the functioning of the electricity and gas markets. Both sectors have undergone profound changes in the last three decades due to technical progress and to the introduction of competition rather than public and private monopolies. Traditionally the energy sector was subject to a high level of public intervention with a monopolistic structure but faced a generalised restructuring and liberalisation process with the aim laying in stimulating competition, improving business efficiency and increasing investment and innovation rates in the firms. The liberalization of electricity and gas sectors have been comparable as they share a set of characteristics, although with some exceptions for each type of energy, leading to different arrangements. Essentially, the electricity sector is made up of a wholesale market that closes its purchase operations basically through simultaneous short-term matching mechanisms, as against the mechanisms of bilateral matching of supply and demand that belong more to the wholesale markets for natural gas.
Published Version
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