In this episode we continue our consideration of what Bill Massey in our first episode this season called "the battle of the statistics" between monopoly and competition advocates. We talk with Michael Giberson, an economist and senior fellow for energy with the R Street Institute, who notes the importance of taking statistics into proper context when attempting to contrast between monopoly utility regulation and competitive markets – particularly the need to account for the impact of inflation when looking at changes in electricity prices over time.
In this episode we continue our consideration of what Bill Massey in our first episode this season called "the battle of the statistics" between monopoly and competition advocates. We talk with Michael Giberson, an economist and senior fellow for energy with the R Street Institute, who notes the importance of taking statistics into proper context when attempting to contrast between monopoly utility regulation and competitive markets – particularly the need to account for the impact of inflation when looking at changes in electricity prices over time.
EMP S4E7: Michael Giberson, R Street Institute
(transcript edited for clarity)
EMP: Welcome to the Energy Markets Podcast. I'm Bryan Lee. And today we will continue our discussion regarding what Bill Massey, in our first episode this season, called the “battle of the statistics.” In our last episode we spoke with Constellation’s Rich Spilky, representing the Retail Energy Supply Association. Rich is carrying forward the body of statistical analysis that former Illinois regulator and consultant, the late Phil O'Connor, performed for the Retail Energy Supply Association, in which he compared over time, and adjusted for inflation, the performance of competitive states versus monopoly states in terms of price, but also in terms of generation efficiency, environmental performance, etc. And the contrast, which used government accumulated data, is conclusive that competitive states are outperforming monopoly states. Joining us today to continue this conversation on the battle of statistics is Michael Giberson, an economist and senior fellow for energy with the R Street Institute, a libertarian-leaning think tank headquartered here in Washington, D.C. Michael, welcome to the podcast.
MG: Thank you, Bryan. I'm happy to be here.
EMP: So I’ve followed your work for many years and I think you would agree with Rich Spilky when he said – well, except for the first part in which he says I'm not an economist – but I think you would agree with him when he says, “I'm not an economist. But if I were an economist, it would be fascinating because everything has been going on in monopoly states and in the competitive states at the same time, in the same country, with the same currency, with the same economic environment. Yet the competitive states in almost all cases are handling things in a superior way compared to monopoly structures.” Would you agree with that?
MG: I mean, I guess as an economist, right, there's always qualifications. But I think, in general, that's correct. And particularly in the better-implemented states with retail competition in electricity, things are going sort of unambiguously better in terms of price and customer service.
EMP: Restructuring, it was all about price, right?
MG: Well, it was a lot about price. The states that were most interested in reforming their regulatory systems were states that, for the most part had high prices compared to their neighbor states. And they had both big industrial customers complaining that rates were too high. They couldn't compete against other companies located in other states that had cheaper electricity. You also had consumer advocates for residential and small commercial customers saying the same thing. And so you know, it takes a bit of political momentum to make a major reform like these reforms were 25 years ago. It has to catch people's eye to get politicians to move, and high prices were one of the things that motivated it.
EMP: Have you noticed a price trend in the decades since we opened up markets in parts of the country to competition?
MG: Well, yeah, so there are a couple of different ways to look at those prices. And maybe the straightforward view is, well, why can't you just look at look at prices and see how they're moving? There are different ways to do that, different data series. Most common, I think, people rely on the Energy Information Administration's data, which is pretty easy to get to. They have a tool now called the Electricity Data Browser, that you can just Google that term, you'll get there. And then you can explore, explore a variety of data series that are pretty easy to sort of work with there. Including looking at average retail prices for different states and for the country as a whole. You can look at residential prices or commercial prices, industrial prices, etc. So it gives you a way a number of ways to look at the data.
EMP: What sort of trends have you seen using these sorts of government statistics?
MG: The EIA data goes back to 2001. In the early 2000s prices were going up from 2001 up until 2008. And then they sort of drift down, or they’re kind of flat, really, on the U.S. average for about, you know, 15 years or so. And then, right in the last few years, you can see the prices starting to go up again.
EMP: That's the macro view of all states.
MG: That’s the big picture. That's all 50 States averaged in.
EMP: If you disaggregate the competitive states from the monopoly states, do you see any kind of difference in the price trend?
MG: Well, you see a couple of things. The first thing is because most of the states that restructured were high-price states to begin with, if you disaggregate them, you see that, well, yes, in fact, back in 2001, those states had higher average prices than the noncompetitive states. Over time, especially in the first few years so that that difference got a little bit bigger, but since 2008, the difference has been coming down. Again, kind of on average. And if you disaggregate Texas from the other states, you see a slightly more interesting story in that Texas has, you know, started about the U.S. average, for a couple of years, it was higher than the U.S. average. But since 2008 or so, 2010, it dropped below the U.S. average and spent most of the last 14 years since cheaper than the rest of the country. And the effect is probably even more interesting in that not all Texas consumers have access to retail choice markets, right? There's both cities like Austin and San Antonio that have municipal utilities, that have not opened up competition to their customers, and electric co-ops that most of which also have not opened retail. It's only in the ERCOT market which covers about 90% of the customers in Texas, but El Paso in the west and parts of the Panhandle and parts of East Texas are also not in the ERCOT system so are not part of the retail market. So it's only a fraction. It’s about 60% to 65% of customers have access to retail choice, and yet it seems to be pulling prices down relative to the U.S. average in the last 15 years or so.
EMP: And there's a lot of factors involved in that overall time period that you're talking about. In 2008, as we discussed with Rich in our last episode, 2008 was about when the shale gas revolution started to have an impact. 2008 was when most of the states had price caps to allow their utilities to recover their stranded costs. 2008 was when those price caps started to come off and you started to see real competition. Despite these clear trends in what is imperfect data, you know, EIA does not disaggregate the commodity price from the wires charges, etc. But despite all of the flaws in the data, there's a real clear trend here, I think, showing that the idea that opening up markets to competition would provide a better means of controlling prices for consumers than the traditional monopoly regulation construct.
MG: So the economist in me says, you know, we have to be careful about two things. It's one thing to look at sort of descriptive data, which if we look at this EIA Data, for example, we see the trends. We can observe what's happening. Drawing conclusions about why things are happening is a much more complicated thing. Because as you say, there's a lot of factors going on. So for example, the transitions, the switching of customers, and such, all that matters as part of the implementation of restructuring. So even though, for example, in Texas, they opened up the market in 2002, but it was a number of years before price caps went away and other policies sort of rolled into place. So, it's tempting to say, well, they started in 2002. That's when you should start your analysis. But they weren't sort of fully rolled into the competitive market system. They had a transition period, just like every other state that reformed had its transition period before sort of the markets were open and free and ready for competition to really begin. And so you want to sort of understand those kinds of things. In addition, if you're trying to compare different states, you know, they started in different positions. Some had higher prices to begin with. Some places are just costlier to do business, right. If you're trying to run a business in California, it's more expensive than running a business in Kansas. It's always been a little bit more expensive in California than in Kansas, you know, real estate's more expensive, the coffee is more expensive, everything seems to be a little more expensive.
EMP: Well, I think it's interesting that we have what I think are really solid data showing the better performance of the competitive states versus the monopoly states and yet, we still have people, I guess I would call them advocates for monopoly, maintaining monopoly regulation, saying that prices are higher in competitive states than they are in noncompetitive states, in monopoly states, and it gets to this whole disinformation age that we're in, what caught my eye was a graph in a post that you put on LinkedIn and I'm going to summarize it for our listeners, since we're an audio-only podcast. And we'll talk about the graph in a second, but you write, “I’ve seen a lot of mention of high electric power prices lately. Some blame wind and solar energy. Others are blaming retail customer choice. Mostly it appears the analysts do not take inflation into account. Real retail prices of electricity in the U.S. are on average about where they were a decade ago and are below the recent peak in 2008.” Which was right when shale gas started to have an impact. And you also mentioned that the rate caps came off in ‘08. You conclude, you can plainly see the consequences in your graph, and I'll explain it. We have in gray, the nominal prices unadjusted for inflation and you see them going up from a little north of maybe a little under seven cents a kilowatt hour. Jumping up to a little over 13 cents a kilowatt hour, okay. But when you adjust for inflation, that graph is a lot flatter. And so, adjusting for inflation, the average retail price of electricity in the United States was south of 13 cents, spiked at well north of 14 cents in the ’08-‘09 period and then came down, fluctuating in between 13 and 12 cents, spiking again last year, when we had another spike in gas prices, at the 14 cent level but still below the plus-14 cents we saw in ‘08. And so I really appreciate your doing this. I think it's really illustrative of how people can take a static look at things and draw the wrong conclusion.
MG: You look at the nominal prices, right? Just the prices as reported, unadjusted, and you see, yes, prices have gone up over the last couple of years. Prices are higher now than they were in early 2020 right before inflation started having an effect. But again, once you take the inflation to account, it's still true that prices are a little bit higher now than they were four years ago. But if you adjust for inflation, where prices are about up about 8% over four years, as opposed to without the adjustment prices would look like they're up 30% over four years. And 8% over four years is not exactly, you know, soaring electricity prices.
EMP: I'm doing a little quick inflation calculator here on my on my phone here. My father when I graduated from college way back in 1980, was paying roughly six cents a kilowatt-hour for electricity. All right. Now let's hit calculate and see . . . so back then he was paying the equivalent of 24 cents a kilowatt-hour for electricity. I forgive him a lot more now, in retrospect, for telling me to put on a sweater and for turning off the lights behind me. I really understand that. I go there just to illustrate what I think is the fact that I don't think electricity has ever been cheaper than it is today.
MG: It was cheaper in late 2019 and early 2020 by a couple of percent, on average, but in the longer sweep of history, even going back 30 or 40 years, you're right. I mean, you know, now, in today's dollars, now we're paying on average, maybe 16 cents a kilowatt hour and using the Bureau of Labor Statistics numbers I calculated the U.S. average was about between 20 to 25 cents per kilowatt hour in today's dollars back in the early ‘80s. Right so, the Reagan Revolution was done with prices running from 20 to 25 cents per kilowatt hour. And then beginning in the mid ‘80s they started on sort of a long trend down that lasted until about the mid 2000s. And when they came up it reached a peak again around about 2008 or so. And then since then sort of resuming that, after a couple of years we started resuming the trend down again. There's been a lot of sort of tumult in economics over the last 20 years as econometrics has, sort of statistical analysis of data, has some undergone a revolution of sorts, that sometimes referred to as the causal revolution, where the statistical techniques have tried to get much more sophisticated in identifying not just correlations in data, which is sort of the old style is sort of looking at correlations and then sort of inferring what the correlations might mean. The newer approach tries to find ways of examining the data to detect the effect of particular causes. So looking at power prices in states before 2008, and after 2008. If 2008 is the date when all the trends you know, when all the price caps and other transition mechanisms went off, then you might get a better idea of just what the competitive market is doing. Now, it turns out that not every state was all aligned on 2008. There were a variety of other things going on. Some states had slightly longer transition periods. Other states modified their retail choice laws. So like Michigan was a retail choice state. They passed their law. I think it was enacted in the year 2000. But in 2008-2009 they decided they weren't so sure about this, and they put a cap of participation on 10%. So about 10% of the customers in Michigan are able to participate in the retail choice market, but 90%, most of the market, is just locked into their utility supplier. It's not really a place where there's flourishing competition, right just it's a place where a lucky few have a choice and they keep it for the most part, and others who want to have choice are stuck on yearslong waiting lists trying to get permitted to choose their own energy supplier.
EMP: Yeah, as we discussed with Rich in our previous episode, that's why it's important that if you're going to compare performance of competitive states versus monopoly states, you get the right states in each bucket for comparison. And you know, certainly Michigan is not a state you want to call competitive. Virginia is not a state you want to call competitive, but yet in a lot of analyses, we see both of them and California, listed as being competitive states. It just skews the results.
MG: Well, right I mean, sometimes newspaper articles have called Oregon a competitive state. It is a state where a few very large industrial customers are permitted to shop for power under certain circumstances. You know, in certain situations. But for residential customers, for pretty much everyone else in the state, they just continue to be served by their local utility, as you know, as they always have, and it's not really a place for active competition. The biggest industrial customers, right they have brokers go out and negotiate contracts for them. And yeah, so they've got they've got a little bit of access to the competitive market. But it's not a flourishing retail market for choice, most customers are still locked in their local utility.
EMP: Well, that's price. Are other things that we can look at besides price that might be a good barometer of whether or not one model is better than the other?
MG: When you look at other features of contracts, it gets a little harder to compare, you know, it's hard to compare apples to apples, right? You might have a contract in Texas where they offer you free nights and weekends. You know, so your power cost is zero cents per kilowatt hour, you know, during particular night periods and on weekends. And you pay a different rate, you know, Monday through Friday, during the day. How do you compare that to a time-of-use rate in some regulated state or how do you compare that to just a plain vanilla flat rate that's sort of common for most the country? You can pay for 100% renewable content.
EMP: Well, if I can interject, Michael, I think you're still trying to talk about price here if I may. I'm thinking do we see a benefit in terms of market entry by lower-carbon fuel sources and that sort of thing?
MG: When you talk about wholesale competition, it's a more complicated story a little bit. You sort of we can divide the country maybe into three different buckets instead of our it wouldn't retail it usually is retail choice allowed or not? Or are you just stuck with your regular utility? In the case of wholesale markets, there are wholesale markets where, you know, in states where there's also active retail choice competition. There's traditionally regulated states, you know, sort of top to bottom where you have utilities that they own their own power plants. They use their own power plants to serve their customers, maybe trading a little bit with their neighbors. And then there are regulated utilities at the retail level where customers don't have choice but the utility itself participates in a competitive regional market. And so you get sort of the pure regulation, you get a retail choice and wholesale competition on the two extremes. Then in between, you have the sort of hybrid where you've got wholesale competition, but retail monopolies. What's happening in those competitive wholesale markets, though, is that they’ve tended sort of accelerate the shift, mostly from coal to natural gas. And that's brought with it a bunch of environmental benefits. Carbon emissions are part of it but it's also part of the sulfur dioxide, nitrous oxide and other air pollutants that are more closely responding and associated with coal-burning than natural gas-burning power plants.
EMP: On this podcast we’ve implicitly made the assertion that competitive markets and electricity offer a better path forward for transitioning to a clean-energy economy at least cost to consumers than does the traditional monopoly structure. Would you agree with that and why?
MG: Yes. I think it's fairly clear, regulated utilities, it's sort of in their nature are somewhat conservative in their adaptation to change. That is, you know, if they've got an old power plant on their books that’s still useful, still productive, still cost-effective in the current environment. You know, they’ll stick with it for the most part, and regulators agree that’s kind of good business practice, right, you don't throw away good resources, when they're still producing. That would be wasteful. That would be bad regulatory practice. And so you know, both regulators and the utility businesses themselves, kind of agree to use up their old systems before they build new power plants. In the competitive markets, it’s shareholders of the companies that are at risk. Consumers aren't tied to old power plants like they are in the in the monopoly system. So if someone comes along with a better mousetrap, people stop buying the old mousetrap. They don't have to pay the losses to the old mousetrap companies. They can just buy the new one. So in most parts of the country as they switched to competitive wholesale markets, you saw a lot of investment in new gas, the cheapest power out around at the time, new combined cycle natural gas power plants. And, you know, pretty soon they were outcompeting coal plants and making it harder on the coal plants to run over the period, you know, as natural gas prices got lower and lower, that just sort of emphasized the efficiency advantage that new power plants have, and coal power plants have been squeezed out of the market in in areas with competitive wholesale markets.
EMP: So we've definitely seen a trend in which there's greater market entry by cleaner resources than there is in a monopoly state. So, on a related topic, you with Lynne Kiesling, another economist and a former guest on this podcast, you two wrote an article for regulation magazine in 2017. It was called, The need for electricity market reforms. An innovative 21st century retail electric power market is within reach, but won't emerge until we ditch 20th century regulation. That title pretty much encapsulates a recurring theme of this podcast. Would you like to elaborate on that?
MG: Well, you know, partly because of the feature of regulation that I just articulated, it tends to be resistant to change, just maybe, maybe the vendor would say it just takes change at a more measured pace. But that's still resistant to change. So that's electric power utilities have tended to be less innovative than competitive power companies. And so we're in a period of sort of rapid change in the economic environment of the electric utility industry. Rapid changes in the environment in a market is a call for rapid change in the industry. And you've got a large segment of the industry that's tied to cost-of-service ratemaking. These are places where prices change slowly, where plans for the future change slowly, where new technologies are risky to both regulators and the regulated utilities because, you know, until you know how things are going work out, it's not clear whether it's worthwhile investing. So it's not a system well designed to take risks on new ideas, new products. In competitive markets, what's more likely, someone's out there thinking, hey, maybe this will work. It seems to pencil out in our calculations, let’s try it. We'll try a little bit here. We'll see if it works. If it does, we'll expand. If it doesn't, we'll go back to the drawing board. But, you know, if you don't think of some new ideas, your competitor is going to and you've got to just struggle to keep up, something we see with competitive markets sort of throughout the economy, right, this constant effort to outdo your competitors, they get in front of the consumers, to attract consumers’ attention to try to attract your business. And then if you want to attract and try to keep the business, that’s just a normal part of market dynamics in the competitive sectors of the economy.
EMP: Well, let's talk a little bit about the difference between the competitive market in Texas and the competitive markets that we have in the dozen or more states outside of Texas that have opened up their market. I guess the main difference being that Texas effectively quarantined the utility from the supply market. So they carry the electricity on their wires for delivery to retail consumers, but they're not the ones selling that commodity. In the other states, the states have adopted what's called default service. It's been very difficult for competition to get as robust a toehold as we've seen in Texas. Do you want to expand on that for us?
MG: In our 2017 article in Regulation magazine, Lynne and I did talk about, did encourage, quarantine the monopoly. The old belief in the electric power industry was that electric business was a natural monopoly. The usual story is, well, it's naturally a monopoly so we better regulate it so that the monopoly doesn't take advantage of consumers. Maybe that was true a hundred years ago, but things have changed. It's clearly no longer true that power generation is a natural monopoly, right? It's no longer, if it ever was, it's no longer a natural monopoly in generation. Similarly, retail supply is not a natural monopoly. Over the wires part of the business, the transmission wires that cross long distances, the distribution wires in, you know, in communities, that part of the business might still be you might plausibly make a natural monopoly argument there that sort of analytically sound. That's possible, but not the other parts of the industry. And so in Texas, right, they still have regulated utilities that serve the retail choice market there, but they're, as we say, confined to the wires part of the business, the transmission lines and the local distribution lines. They don't own power plants. They don't sell power to customers. They just provide delivery service. And sort of by law, they can't be affiliated corporately with anyone who's in the supply business, or in the retail business, in the generation business or the retail business. And this is desirable because, in a sense, the transmission lines act as sort of the delivery platform for generation to reach end-use customers. And you want the delivery service to be neutral among suppliers. I mean, in the sense like, you know, the U.S. Postal Service, if they, you know, if they also sold books, and now Amazon sells books and Amazon wants to use the U.S. Postal Service to sell books, the U.S. Postal Service says, well, you know, we’ll deliver your books, Amazon, but we're going to charge you an extra price, an unfair price. And yeah, regulators might try to come in and regulate the delivery price of books. But they don't know all the inside information that the Postal Service does. So it's possible for the Postal Service to have shifted some of their own costs onto the companies that are trying to compete with them. So we see that sort of subsidization going on, you know, through default service in most of the, you know, in the New England states and most of the other states other than Texas, because they haven't fully quarantined the monopoly. So you've got a default service rate that covers the energy costs of supply, but it doesn't cover all the administrative costs of managing a retail supply program. So, competitors in most retail choice states aren’t quite facing a fair fight because they're required, in effect required, to subsidize the default service because of the way that costs get allocated in regulatory processes.
EMP: Yeah, and we've seen a real difference in terms of innovation in Texas versus the other states. I mean, it's, I keep pointing to the growth in electricity storage in Texas as an example. I think we saw something like this on the telecom side. I mean, Judge Greene, what was it, ’84, when he broke up AT&T? But you still had the Baby Bells, and they were an impediment to competition. And it wasn't until the 1990s when Congress stepped in and made a more effective paradigm for competition and all of a sudden everybody's walking around with smartphones with more computer capability than the Apollo astronauts had when they landed on the moon. And we're all watching cat videos. I really think your premise with Lynne in the 2017 article in Regulation is spot on. We really need to address the drag effect that the continued monopoly presence in electricity markets is having as we try to move to a 21st century clean-energy economy.
MG: But in the telecommunications case, the Judge Greene’s decision, I think that was where the term “quarantine the monopoly” emerged from. The concern there was that if you let the monopoly stay in what were opened up, in markets opened up the competition, that it would find ways to sort of use its monopoly position to advantage its competitive retail position. So we notice for example, in Ohio, which they reformed, they have retail choice. And yet they didn't quarantine the monopoly. So you have the local utilities that own the wires that provide the delivery service. They have corporate affiliates part of the big, same large corporations but a different company that produces power, and another separate company within the corporation that is supplying default service. And so you have this huge bribery scandal where you have representatives of the wires utility lobbying regulators and legislators to provide a subsidy to power plants. So the wires part of the business is encouraging regulators, encouraging state legislators to subsidize power plants owned by their competitive arm of the company and to load extra charges on to retail customers to benefit those power plants that were uneconomic. Part of the advantage of moving to a more competitive, less-regulated market is to help reduce the opportunities for corruption. If you don't quarantine the monopoly, well, it appears to leave the door open for corruption.
EMP: Well, getting back to the issue of default service with the utilities having their impact in the marketplace there. Here in Maryland, and in Massachusetts, there are ongoing legislative debates over legislation from the retail suppliers’ perspective would effectively end retail choice for the residential electric market. And, again, we've got an effect here where because the utilities are still in the market for supply, they're skewing the market. The retail suppliers, as you explained, don't really have an even playing field to compete with the utilities. What's the answer there? Should the states be acting the way they plan to in Massachusetts in Maryland to address what they perceive as corruption by retail suppliers?
MG: A number of legislators and other observers sort of purport to be disappointed with the results of competition. It hasn't delivered what they thought they were promised. And so now they want to give up and go back to the old system. You ought to consider whether the policies that the state has adopted actually provide a good foundation for competition. So quarantining the monopoly is part of it, and taking out that the subsidy for default service is part of creating a situation where there can be real competition. Similarly, in most states that have retail choice they use what's called utility consolidated billing, meaning that customers no matter whether they stick with default service, or they switch to a competitive retailer, they still get a bill from their local utilities, the same utility that's been around for you know, a hundred years, perhaps. And the name of the supplier is sort of hidden away on page two or three in the fine print. We just have, you know, it just looks like a bill from the utility company, no matter who your supplier is. So it diminishes the ability of those suppliers to establish a brand name. In effect, a lot of times in these debates, both in Massachusetts and Connecticut and Maryland, you hear complaints about unethical marketing companies that induce people to switch to a with a low leader price, and then after a couple of months, they'll raise that rate and charge too much. This is a marketing strategy that state policies help promote because if you use supplier consolidated billing, then these unethical suppliers would have to bill their own customers. If you get a bill from a company you haven't heard of, you're going to ask questions before you send a check. Under the under the current situation, under the policy choices by Massachusetts, by Connecticut, by Maryland, they're getting the bill from the utility, you know, it's good old Baltimore Gas & Electric, that’s sending them a bill. If some unethical company has somehow switched that customer over it's only if the customer is reading their bill carefully, will they see that some unexpected supply change has come about. If a state is using utility consolidated billing, if they're using default service that includes this sort of cross subsidy issue we talked about, they’re creating an environment, which is, which basically handicaps competition. It's kind of not surprising that we don't see more customers switching because they've designed things and implemented policies that basically have allowed retail choice but handicapped it.
EMP: That's well said. I've run through my notes. As I do with all of my guests, I'll throw it to you if there's anything we haven't discussed that you think is worth bringing up before we leave, please do so.
MG: In looking at the price data, and trying to compare prices over time, there's one other method that we haven't talked about, but it's sometimes referred to as looking at the time price of a product or a service. That is, how much time would it take a worker earning the median wage to earn enough to buy a certain amount of power? It's kind of a focus on price. But, you know, adjusting for inflation only tells me how fast a price is changing relative to other prices. But if we're taking it from the consumer’s point of view, the consumer’s got an income, their income is changing. If their income is growing faster than other prices, then even if those prices are going up, it's not the pain to the customer if their wages are going up. So I looked at median earnings data back in the early ‘80s and median earnings data now. Median weekly earnings have gone up by about five times over that 40- to 44-year period from 1979 to 2023 is the data that I had available. Power prices have only gone up about three times over that same period. And so power prices, you know, again, relative to earning power, power prices have dropped pretty significantly. If you look at the time price of a kilowatt-hour of electricity, it used to be back in the early ‘80s, it took about 35 seconds to buy a kilowatt-hour of electricity, you know, at the median wage, so you're earning maybe about $15 an hour I think back in 1980 was the median wage. It took you about 35 seconds to earn enough to buy power at the current prices then. Today that’s down under 20 seconds. So even with the recent price increases, some of which have been offset by wage increases, it takes you now about 20 seconds at the median wage to earn enough to buy a kilowatt-hour of electricity.
EMP: Well, that's a great point. I'm glad you pointed that out for us. I appreciate you making the time to talk with us today. Michael Giberson, senior fellow, energy, for the R Street Institute. Thank you so much.
MG: Thank you, Bryan.
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