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 / Spring 2005 / Issue 38(originally published by Booz & Company)


Supermodels to the Rescue

Dr. Macal and the team have now used their model to identify some potential problems with the proposed deregulation. In particular, they have found that the distributed nature of the electrical network makes it quite conceivable that some companies would be able to engineer geographical “pockets” in which they would effectively have monopoly power and could set prices as they wished. This, of course, is precisely the kind of situation that effective deregulation seeks to avoid. The Argonne project is currently working to establish the credibility of this finding, varying many tiny details within the model to be sure that the problem is not a spurious artifact, but persists under all reasonable assumptions. If the preliminary findings stand up, then Dr. Macal and his colleagues will employ the model in another way — to begin exploring options for mitigating the problem, by maintaining regulation over specific regions of the network or through other mechanisms.

Reprint No. 05106

Author Profiles:

Mark Buchanan ([email protected]) is the author of Nexus: Small Worlds and the Groundbreaking Science of Networks (W.W. Norton, 2002) and Ubiquity: The Science of History, or Why the World Is Simpler Than We Think (Random House, 2001). Formerly an editor with Nature and New Scientist, he holds a Ph.D. in physics from the University of Virginia.

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