Energy is the backbone of industrial economies. However, energy production and consumption has extensive social costs associated with it, from the emission of carbon dioxide and other airborne pollutants to national security implications due to the uneven distribution of fossil fuel resources around the globe. Balancing the benefits and costs of energy use today over a long time horizon is one of most important challenges facing the world today. This course is designed to give you an understanding of how primary energy and electricity markets operate. We will examine the economic determinants of industry structure, the associated public policy challenges associated with these structures, and economically appropriate forms of government intervention in a market. We will also examine how policy can and has responded to the external costs of energy production and how the recent trend toward distributed electricity generation affects the electricity industry and consumers as well as the distributional consequences of distributed electricity generation.