Regulating access via economic principles

The right policy to balance the benefits of allowing the distco to fully utilize the efficiency advantage of vertical integration against the risks of anticompetitive conduct, is neither to split up the distco not to compel that it share all its facilities. This article shows that the general policy...

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Bibliographic Details
Published inThe Electricity journal Vol. 12; no. 7
Main Authors Hinton, P.J., Zona, J.D.
Format Journal Article
LanguageEnglish
Published United States 01.09.1999
Subjects
COMPETITION
ELECTRIC POWER INDUSTRY
ENERGY PLANNING AND POLICY
POWER DISTRIBUTION SYSTEMS
VERTICAL INTEGRATION
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Summary:The right policy to balance the benefits of allowing the distco to fully utilize the efficiency advantage of vertical integration against the risks of anticompetitive conduct, is neither to split up the distco not to compel that it share all its facilities. This article shows that the general policy of compelling access to essential facilities, accompanied by effective monitoring and imputation rules, will strike the right balance: maximizing the benefits of competition, while preventing anticompetitive conduct.
ISSN:1040-6190
1873-6874
DOI:10.1016/S1040-6190(99)00064-0