Electricity Unit Value Prices and Purchase Quantities: U.S. Manufacturing Plants, 1963-2000

Steven Davis, Cheryl Grim, John C. Haltiwanger and Mary Streitwieser , Review of Economics and Statistics 95(4) , 1150-1165 , October 2013.

We measure unit value electricity prices using 2 million annual observations on U.S. manufacturing plants from 1963 to 2000. These prices display tremendous cross-sectional dispersion, 85–95% of which reflects differences by plant location and purchase quantity. Spatial differentials decline markedly until the late 1980s for large purchasers but rise over time for small purchasers. Unit value price gaps between larger and smaller purchasers are enormous, diminish through the late 1970s, and then stabilize at still-high levels. There are major differences across states in cost and regulatory factors that we relate to the changing structure of unit value prices.

Links to Researchers