U.s. Electricity Revolution And California Electricity Crisis What Should Chinese Energy Market Learn?

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Fin-482 Term Paper Yiming Pan 5th, DEC, 2015 Prof. Scott Wrigglesworth and Teresa Marrinan Analysis of the U.S. electricity revolution and California electricity crisis-What should Chinese Energy market learn? The energy issues have long been complicated and highly discussed for energy affects many aspects of the modern society and people’s daily lives, e.g. oil prices, energy reserves, monthly electricity bills etc. Since my father is working in the Investment and Marketing department of China Citi Bank, I was encouraged to read energy-related reports and journals from the newspapers when I was growing up. Later on I became interested in the energy market, including energy commodity trading and portfolio management. Furthermore, as a…show more content…
I really think this case has some meaningful points for my country. The California Electricity Crisis was an unprecedented disease for state government and citizens because it brought inconvenience for citizen 's daily lives and series of subsequent encumbrance for governments ' financial expense or public investments. ‘The crisis of California was cost between 40 to 45 billion dollars ' (Weare, 2003). Weare stated this crisis obviously would lead to a series of issues in the future because the crisis caused catastrophic damage on the investment plans and expense management of California state government. ‘The financial crisis was possible because of partial deregulation legislation instituted in 1996 by the California legislature and Governor Pete Wilson. Enron took advantage of this deregulation and was involved in economic withholding and inflated price bidding in California 's spot markets. ' (FERC Summary of findings, 03-17). Actually, the deregulation legislation reform started as early as 1996, which depended on the demand of improvement in the market. Afterward, the state government tried to use reformation to gradually improve the whole electricity and energy market. After the reformation, the electricity indeed achieved some success in two years. The wholesale price and the energy demand maintained stable, at that time, the wholesale price per month was around $30 to $40/MWh. “It was a delighted period, and the achievement of

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