An Empirical Investigation of Explosive Price Behavior in U.S. State-Level Electricity Markets Across Consumer Segments

Mert Sarıtaş M., Konat G., Dalyancı H. L., Yılancı V.

ENERGIES, vol.18, no.21, pp.1-28, 2025 (SCI-Expanded)

  • Publication Type: Article / Article
  • Volume: 18 Issue: 21
  • Publication Date: 2025
  • Doi Number: 10.3390/en18215689
  • Journal Name: ENERGIES
  • Journal Indexes: Scopus, Aerospace Database, Agricultural & Environmental Science Database, Science Citation Index Expanded (SCI-EXPANDED), Academic Search Premier, Communication Abstracts, Compendex, INSPEC, CAB Abstracts, Metadex, Veterinary Science Database, Directory of Open Access Journals, Civil Engineering Abstracts
  • Page Numbers: pp.1-28
  • Çanakkale Onsekiz Mart University Affiliated: Yes

Abstract

This study investigates speculative bubbles in U.S. state-level electricity markets across commercial, industrial, and residential segments. Using monthly data (2005–2025) from the U.S. Energy Information Administration and employing the Generalized Supremum Augmented Dickey-Fuller test, evidence of localized explosive price behavior was observed predominantly in Florida, Hawaii, Pennsylvania, and Oregon, among others. These bubbles, often tied to market disruptions such as fuel price volatility and post-pandemic recovery, were mainly short-lived and region-specific. The findings highlight the need for tailored, state-specific regulatory strategies to address unique market dynamics, ensuring stability amidst the ongoing energy transition.

This study investigates speculative bubbles in U.S. state-level electricity markets across commercial, industrial, and residential segments. Using monthly data (2005–2025) from the U.S. Energy Information Administration and employing the Generalized Supremum Augmented Dickey-Fuller test, evidence of localized explosive price behavior was observed predominantly in Florida, Hawaii, Pennsylvania, and Oregon, among others. These bubbles, often tied to market disruptions such as fuel price volatility and post-pandemic recovery, were mainly short-lived and region-specific. The findings highlight the need for tailored, state-specific regulatory strategies to address unique market dynamics, ensuring stability amidst the ongoing energy transition.