Fundamental flaws in the current cost regulatory capital value method of utility pricing

Jo Armstrong, Brian Ashcroft (Editor)

Research output: Contribution to journalArticle

Abstract

Jim Cuthbert and Margaret Cuthbert’s most recent analysis of the UK’s utility businesses (see QEC Vol 31 No 3) seeks to challenge the fundamental price setting methodology adopted by utility regulators. The basis of the challenge arises from an estimate of the size of the apparent super normal profits being made by utility companies. From this they conclude that the resultant equity return is too high and so leaves customers paying prices that are too high for the services provided1.
LanguageEnglish
Pages38-40
Number of pages3
JournalQuarterly Economic Commentary
Volume31
Issue number4
Publication statusPublished - Jul 2007

Fingerprint

Regulatory capital
Pricing
Costs
Equity returns
Price setting
Profit
Methodology

Keywords

  • Fraser of Allander Institute
  • capital value
  • utility pricing
  • utility companies

Cite this

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Fundamental flaws in the current cost regulatory capital value method of utility pricing. / Armstrong, Jo; Ashcroft, Brian (Editor).

In: Quarterly Economic Commentary, Vol. 31, No. 4, 07.2007, p. 38-40.

Research output: Contribution to journalArticle

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