Interconnected power lines over a city skyline

Decoding the Game: How Power Moves Impact Electricity Prices

Reese Marlowe in Business & Economy August 2025 • 4 min read.

"Uncover the hidden strategies in Alberta's electricity market and how they affect your energy bills."

Ever wonder why your electricity bill seems to fluctuate for no apparent reason? The world of energy markets is complex, and it’s often hard to see how decisions made by power companies directly impact what you pay. Transparency, in theory, should help keep things fair, but what happens when that transparency is used strategically?

A recent study focused on Alberta's unique electricity market, where companies have historically had access to near real-time data about their competitors' bidding strategies. This information, released via the Historical Trading Report (HTR), was intended to create a level playing field. Instead, some firms allegedly used it to identify rivals' moves and potentially manipulate prices. But how exactly did they do it, and what does it mean for consumers?

This article breaks down the key findings of that study, exploring how information transparency can be a double-edged sword. We’ll uncover the strategies firms use to “tag” their offers, how they respond to competitor actions, and what regulators can do to ensure a fair and competitive energy market. Whether you’re an energy expert or just someone trying to save on your monthly bill, understanding these dynamics is crucial.

The Alberta Experiment: A Market Under the Microscope

Interconnected power lines over a city skyline

Alberta's electricity market operates as an “energy-only” system. This means companies make money solely from the electricity they sell. Unlike some markets, there are fewer restrictions on how high companies can bid, with the intent being to encourage investment in new energy infrastructure. This unique setup made Alberta a prime location to study how companies behave when they have a lot of information about their rivals.

Until recently, the Alberta Electric System Operator (AESO) published the HTR, which showed, with a short delay, all the price and quantity bids made by each company. The identities of the companies were not revealed, but the Market Surveillance Administrator (MSA) believed that sophisticated players could figure out who was behind each bid. This led to concerns that the HTR was enabling a form of tacit collusion, where companies could signal their intentions and coordinate to keep prices high.

The Allegations: The MSA alleged that some companies were using the HTR to “tag” their offers with unique patterns, allowing rivals to identify them and potentially coordinate on higher prices.
The Concerns: This behavior raised fears that the HTR, instead of promoting competition, was actually facilitating market power and harming consumers.
The Outcome: After a hearing, the Alberta Utilities Commission (AUC) decided to stop publishing the HTR in May 2017, citing concerns that it facilitated the enhancement of market power.

So, what did the study reveal about these allegations, and how did companies potentially use the HTR to their advantage?

What Does This Mean for Your Energy Bill?

The Alberta study provides valuable insights into the complexities of energy markets and the potential pitfalls of information transparency. While the HTR is no more, the core lessons remain: Regulations need to be carefully designed to prevent unintended consequences. The balance between providing information to promote competition and preventing strategic manipulation is delicate, and ongoing vigilance is essential. As consumers, staying informed about these market dynamics can empower us to advocate for policies that promote fair and affordable energy.

About this Article -

This article was crafted using a human-AI hybrid and collaborative approach. AI assisted our team with initial drafting, research insights, identifying key questions, and image generation. Our human editors guided topic selection, defined the angle, structured the content, ensured factual accuracy and relevance, refined the tone, and conducted thorough editing to deliver helpful, high-quality information.See our About page for more information.

This article is based on research published under:

DOI-LINK: 10.1007/s11149-018-9372-z, Alternate LINK

Title: Information And Transparency In Wholesale Electricity Markets: Evidence From Alberta

Subject: Economics and Econometrics

Journal: Journal of Regulatory Economics

Publisher: Springer Science and Business Media LLC

Authors: David P. Brown, Andrew Eckert, James Lin

Published: 2018-11-21

Everything You Need To Know

What is the Historical Trading Report (HTR), and what was its original purpose in Alberta's electricity market?

The Historical Trading Report (HTR) was a publication by the Alberta Electric System Operator (AESO) that provided near real-time data on the price and quantity bids made by companies in Alberta's electricity market. Its original purpose was to create a level playing field by increasing transparency. The Market Surveillance Administrator (MSA) believed increased transparency would promote competition among firms.

How did some companies allegedly misuse the Historical Trading Report (HTR) in Alberta, and what were the potential consequences?

Some companies allegedly used the Historical Trading Report (HTR) to "tag" their offers with unique patterns, allowing rivals to identify their bidding strategies. This raised concerns with the Market Surveillance Administrator (MSA) that, instead of fostering competition, the HTR enabled tacit collusion, potentially leading to higher prices for consumers. The Alberta Utilities Commission (AUC) eventually stopped publishing the HTR in May 2017 because of these concerns.

What does it mean that Alberta's electricity market operates as an 'energy-only' system, and how does this impact electricity prices?

In Alberta's 'energy-only' system, companies primarily generate revenue solely from the electricity they sell on the open market. The intention behind this setup is to encourage investment in new energy infrastructure, as there are fewer restrictions on how high companies can bid. However, this also means that the incentive to maximize profits is very high and can contribute to price volatility and the potential for strategic bidding behavior by firms seeking to maximize their returns.

Beyond the Historical Trading Report (HTR), what broader lessons can be learned about transparency and regulation in energy markets?

The Alberta study highlights that transparency can be a double-edged sword. While intended to promote competition, increased transparency, like that afforded by the Historical Trading Report (HTR), can be exploited for strategic manipulation. Regulations must be carefully designed to prevent unintended consequences. Ongoing vigilance and adaptation are essential to strike the right balance between providing information and preventing firms from gaming the system to the detriment of consumers. The Market Surveillance Administrator (MSA) played a key role in raising concerns about the Historical Trading Report (HTR).

How can consumers benefit from understanding the dynamics of Alberta's electricity market, even after the Alberta Utilities Commission (AUC) stopped publishing the Historical Trading Report (HTR)?

Understanding the dynamics of Alberta's electricity market empowers consumers to advocate for policies that promote fair and affordable energy. Even without the Historical Trading Report (HTR), awareness of how companies may strategically bid, and the impact of market regulations, can help consumers engage in informed discussions with policymakers and support initiatives that ensure a competitive market. By staying informed and advocating for fair regulations, consumers can play a vital role in shaping a more equitable and efficient energy market. Consumers may wish to follow the actions of the Alberta Electric System Operator (AESO) and the Market Surveillance Administrator (MSA).