Efficiency Aspects of Diversification by Public Utilities

  • Roger Sherman
Part of the Topics in Regulatory Economics and Policy book series (TREP, volume 3)


Diversification by public utilities is growing. The trend has brought efforts on one hand to remove barriers that stand in the way of diversification, such as the Public Utility Holding Company Act of 1935, and on the other hand efforts to limit diversification further. In both the House and the Senate, for example, proposals have been introduced to modify the Public Utility Holding Company Act, specifically with regard to public utility diversification.1 The holding company played an important role in developing the electricity industry early in this century, but its complexities were abused, and limits on its use were imposed through the 1935 Act. If diversification by public utilities can improve efficiency, then such restrictions on it need to be evaluated.


Capital Structure Public Utility Electric Utility Federal Energy Regulatory Commission Diversify Firm 
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© Kluwer Academic Publishers 1989

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  • Roger Sherman

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