Wholesale Energy

AAA

DEFINITION of 'Wholesale Energy '

A term referring to the purchase and sale of energy products – primarily electricity, but also steam and natural gas – in the wholesale market by energy producers and energy retailers. Other participants in the wholesale energy market include financial intermediaries, energy traders and large consumers. Wholesale energy markets developed following the deregulation and restructuring of utilities and electricity markets around the world in the 1990s.

INVESTOPEDIA EXPLAINS 'Wholesale Energy '

There are independent system operators that coordinate, control and monitor the operation of the energy market. The deregulation of electricity markets and the development of wholesale energy markets have provided end-user benefits such as enhanced reliability, efficient grid dispatch and better price transparency. However, detractors of the wholesale energy concept maintain that it may actually lead to higher prices for retail consumers and can cause artificial shortages such as the California energy crisis of 2000-2001 due to market manipulation.

RELATED TERMS
  1. Federal Energy Regulatory Commission ...

    An independent agency responsible for regulating interstate oil ...
  2. Deregulation

    The reduction or elimination of government power in a particular ...
  3. Spark Spread

    The difference between the market price of electricity and its ...
  4. Utilities Sector

    A category of stocks for utilities such as gas and power. The ...
  5. Energy Derivatives

    A derivative instrument in which the underlying asset is based ...
  6. Unconventional Oil

    A type of petroleum that is produced or obtained through techniques ...
Related Articles
  1. 10 Ways To Save Energy And Money
    Personal Finance

    10 Ways To Save Energy And Money

  2. Fueling Futures In The Energy Market
    Options & Futures

    Fueling Futures In The Energy Market

  3. Losing The Amaranth Gamble
    Retirement

    Losing The Amaranth Gamble

  4. How To Buy Oil Options
    Options & Futures

    How To Buy Oil Options

comments powered by Disqus
Hot Definitions
  1. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  2. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  3. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  4. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  5. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
  6. Limit-On-Open Order - LOO

    A type of limit order to buy or sell shares at the market open if the market price meets the limit condition. This type of ...
Trading Center