Università della Svizzera italiana

Yardstick regulation of electricity distribution utilities based on the estimation of an average cost function

Filippini, Massimo ; Wild, Jörg

In this paper we estimate an average-cost function for a panel of 45 Swiss electricity distribution utilities as a basis for yardstick regulation of the distribution-network access prices. Unlike the existing literature, we separate the electricity sales function of utilities from the network operation function. Several exogenous variables measuring the heterogeneity of the service areas were...

Università della Svizzera italiana

Using stochastic frontier analysis for the access price regulation of electricity networks

Filippini, Massimo ; Wild, Jörg ; Kuenzle, Michael

The deregulation of the electricity industry is currently on the political agenda in many countries. In most countries, the deregulation of the sector is combined with a (re-) regulation of the electricity networks in most of the countries. In many countries incentive-based regulation – e.g. price-cap regulation, yardstick regulation – was introduced to promote efficiency improvements in...