COURSE NUMBER: MBA212.1

COURSE TITLE: Energy and Environmental Markets

UNITS OF CREDIT: 3 units

INSTRUCTOR: Severin Borenstein

E-MAIL ADDRESS: borenste@haas.berkeley.edu

MEETING DAY(S)/TIME: Monday and Wednesday, 11:00AM – 12:30PM

PREREQUISITE(S): Microeconomics (MBA201A) or its equivalent.

CLASS FORMAT: Classes will be a mixture of lectures and case discussions

REQUIRED READINGS: The course will use a packet of readings and case materials.

BASIS FOR FINAL GRADE:

50% exams- in class quizzes and final exam

40% energy strategy games and writing assignments

10% class participation

NO ELECTRONICS POLICY: This course will follow the “no electronics” policy that is used in the MBA core. Use of laptop computers, cellphones, ipads, or other electronic devices during class will not be permitted. If you have a certified medical need to use a laptop in class, please come and talk to me about it.

ABSTRACT OF COURSE'S CONTENT AND OBJECTIVES:

In the past 35 years, some of the largest industries have transitioned from regulated to market-based paradigms. Managers in many transportation, information technology, and energy companies have had to devise strategies to cope with changes in economic and environmental regulations and the evolution of new markets and trading platforms. The energy industries feature a complex mix of regulation and market-driven incentives. Over the 15 years, energy markets that had previously been viewed as staid and conservative have been rocked by deregulation initiatives, the California electricity crises, the Enron scandal, rising commodity prices, and now the challenge to reduce greenhouse gases.

Drawing on the tools of economics and finance, we study the business and public policy issues that these changes have raised in energy markets. Topics include the development and effect of organized spot, futures, and derivative markets in energy; the political economy of deregulation; climate change, environmental policy and the emerging markets for green energy; market power and antitrust; and the transportation and storage of energy commodities. We examine the economic determinants of industry structure and evolution of competition among firms in these industries; investigate successful and unsuccessful strategies for entering new markets and competing in existing markets; and analyze the rationale for and effects of public policies in energy and environmental markets.

BIOGRAPHICAL SKETCH:

Severin Borenstein is the E.T. Grether Professor of Business Administration and Public Policy at the Haas School of Business and Co-Director of the Energy Institute at Haas. He received his A.B. from U.C. Berkeley in 1978 and Ph.D. in Economics from M.I.T. in 1983. His research focuses on business competition, strategy, and regulation. He has published extensively on airline competition, the oil and gasoline industries, and electricity markets. His current research projects include the economics of renewable energy, energy efficiency evaluation, cap and trade markets for GHG reductions, and competitive dynamics in the airline industry. Borenstein is also a research associate of the National Bureau of Economic Research in Cambridge, MA. He served on the Board of Governors of the California Power Exchange from 1997 to 2003. During 1999-2000, he served on the California Attorney General's Gasoline Price Task Force. In 2010-11, he served on the Department of Transportation's Future of Aviation Advisory Committee and on the Supply and Infrastructure taskforce of the Department of Energy's National Petroleum Council Study of the Future of Transportation Fuels.  He is currently a member of the Emissions Market Assessment Committee for California’s GHG cap and trade market.