Download PDF by James I. ; United States. ; Mid-America Economics Institute.: A consumer's guide to the economics of electric utility

By James I. ; United States. ; Mid-America Economics Institute. Illinois Office of Consumer Services. Sturgeon

This consultant offers basically with the economics of electrical utilities, even though sure felony and organizational elements of utilities are mentioned. all of the seven chapters addresses a selected part of public-utility ratemaking. bankruptcy One incorporates a dialogue of the evolution of the public-utility thought, in addition to the felony and monetary justification for public utilities. the second one bankruptcy units forth an Read more...

summary: This consultant offers basically with the economics of electrical utilities, even though definite felony and organizational points of utilities are mentioned. all of the seven chapters addresses a specific part of public-utility ratemaking. bankruptcy One incorporates a dialogue of the evolution of the public-utility suggestion, in addition to the felony and monetary justification for public utilities. the second one bankruptcy units forth an analytical fiscal version which gives the foundation for the subsequent 4 chapters. those chapters include a close exam of overall working expenditures, the speed base, the speed of go back, and the speed constitution. the ultimate bankruptcy discusses a few present matters relating to electrical utilities, customarily components relating to fuel-adjustment charges, ads, taxes, building paintings in growth, and lifeline premiums. a number of the examples utilized in the advisor are from specific states, comparable to Illinois and California. those examples are used to demonstrate particular issues. shoppers in different states can generalize them to their states and never switch the which means or value of the issues

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Also, a commission usually has its own staff and this staff can become bogged down in administrative detail, embroiling commissions in matters of procedure rather than in regulating the industry. " This means that many times commissioners "industry-mindedness. 1I ( ' ~'\ either start out with or gradually acquire the attitudes of the \ -41- industries they regulate. occuring. - electric utility industry as the people who work for it. when commissioners commi s s i oners want information i nf ormat i on on a technical techn i ca 1 Thus or non-technical aspect of the industry they customarily call upon members of the industry.

But when demand continued to increase a larger plant, plant size 3, had to be built and cost per unit increased. "- If this argument is correct, it means that greater efficiency would occur if the industry had more firms operating with plant size 2. That is, this argument leads to a breakdown in the idea that a natural monopoly exists in electricity generation. FIGURE 3-A Long Run Cost Per KWH u Output or Quantity Demanded The second possibility decreasing cost industry, absolute cost. is that the industry remains a but has experienced an increase in This means that the price of its inputs have increased and caused the cost curve to shift upward.

ATloo Es~IAI.. TO WEu=. FOR'IS SuBsTITUTES, CAses l. , ~ PlsLIC iNTEREST If'PLIED PoERS AND GoALS OF REGULATION ~J RATES &EARNINGS S~ SAFE' TYJ SeRvICE SERvICE AND EFFICIENCY PHD CoRP. FINANCE & INlERCORP. FIN. fcmLM'S & REPORTS GoALS INVESTORJ Cooslft:RJ CoosltERJ END IN VIEW 6a£RAL. l'\'lELFAREJ 6a£RAL APPENDIX The long run average cost curve is a composite of the cost of operating various sizes of plants. If the cost per unit decreases over the entire curve it looks like the one in FIGURE I-Abelow, and is said to reflect economies of scale* and hence decreasing cost, over its entire length.

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A consumer's guide to the economics of electric utility ratemaking by James I. ; United States. ; Mid-America Economics Institute. Illinois Office of Consumer Services. Sturgeon


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