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Regulating Power

The Economics of Electricity in the Information Age

  • Carl Pechman
Book

Part of the Topics in Regulatory Economics and Policy Series book series (TREP, volume 15)

Table of contents

  1. Front Matter
    Pages i-xi
  2. Carl Pechman
    Pages 1-8
  3. Carl Pechman
    Pages 149-173
  4. Carl Pechman
    Pages 175-184
  5. Carl Pechman
    Pages 185-192
  6. Back Matter
    Pages 193-229

About this book

Introduction

Modem industrial society functions with the expectation that electricity will be available when required. By law, electric utilities have the obligation to provide electricity to customers in a "safe and adequate" manner. In exchange for this obligation, utilities are granted a monopoly right to provide electricity to customers within well-defmed service territories. However, utilities are not unfettered in their monopoly power; public utility commissions regulate the relationship between a utility and its customers and limit profits to a "fair rate of return on invested capital. " From its inception through the late 1970s, the electric utility industry's opera­ tional paradigm was to continue marketing electricity to customers and to build power plants to meet customer needs. This growth was facilitated by a U. S. energy policy predicated upon the assumption that sustained electric growth was causally linked to social welfare (Lovins, 1977). The electric utility industry is now in transition from a vertically integrated monopoly to a more competitive market. Of the three primary components (generation, transmission, and distribution) of the traditional vertically integrated monopoly, generation is leading this transformation. The desired outcome is a more efficient market for the provision of electric service, ultimately resulting in lower costs to customers. This book focuses on impediments to this transformation. In partiCUlar, it argues that information control is a form of market power that inhibits the evolution of the market. The analysis is presented within the context of the transformation of the U. S.

Keywords

Generator Potential computer development electricity regulation

Authors and affiliations

  • Carl Pechman
    • 1
  1. 1.New York State Department of Public ServiceAlbanyUSA

Bibliographic information