COURSE NUMBER: MBA212

COURSE TITLE: Energy and Environmental Markets

UNITS OF CREDIT: 3 units

INSTRUCTOR: Severin Borenstein

E-MAIL ADDRESS: severinborenstein@berkeley.edu

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 available on bCourses.

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  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 in the developed world have transitioned from regulated to market-based paradigms. Managers in many transportation, information technology, and energy companies have had to devise strategies to cope the evolution of new markets and trading platforms, as well as   changes in economic and environmental regulations.  The energy industries feature a complex mix of regulation and market-driven incentives, which vary across countries and across states in the U.S.  Over the past 20 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 and collapsing commodity prices, and now the challenge to reduce greenhouse gases at the same time the fracking revolution in reducing the cost hydrocarbon extraction.

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 regulation and deregulation of energy utilities;  climate change, environmental policy and the emerging markets for green energy; the development and effect of organized spot and futures markets in 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 Research Associate of the Energy Institute at Haas. He received his A.B. from U.C. Berkeley and Ph.D. in Economics from M.I.T.  His research focuses on business competition, strategy, and regulation.  He has published extensively on airline competition, the oil and gasoline industries, electricity markets, and environmental policy. His current research projects include the economics of renewable energy, market mechanisms for GHG reductions, retail electricity rate design, and consumer response to energy prices.  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.  During 2012-13 he was a member of the Emissions Market Assessment Committee for California’s GHG cap and trade market.  He is currently chair of the California Energy Commission's Petroleum Market Advisory Committee and a member of the Advisory Council of the Bay Area Air Quality Management District.