In this paper, we develop a novel electric power supply chain network model with fuel supply markets that captures both the economic network transactions in energy supply chains and the physical network transmission constraints in the electric power network. The theoretical derivation and analyses are done using the theory of variational inequalities. We then apply the model to a special case, the New England electric power supply chain, consisting of 6 states, 5 fuel types, 82 power generators, with a total of 573 generating units, and 10 demand market regions. The empirical case study demonstrates that the regional electric power prices simulated by the proposed model very well match the actual electricity prices in New England. We also compute the electric power prices under natural gas and oil price variations. The empirical examples illustrate that both the generating unit responsiveness and the electric power market responsiveness are crucial to the full understanding and determination of the impact of the residual fuel oil price on the natural gas price. Finally, we utilize the model to quantitatively investigate how changes in the demand for electricity influence the electric power and the fuel markets from a regional perspective.