 Effects of long-term tariff regulation on investments under low credibility of rules: Rate-of-return and price cap in Russian electricity gridsSvetlana Avdasheva () and Yulia Orlova Energy Policy, 2020, vol. 138, issue C Abstract: The transition from a short-term cost-plus tariff regulation to either a long-term rate-of-return or long-term price cap regulation in Russia started in 2009 and was completed in 2012, causing substantial changes in investment over the course of the reform. We estimate panel data of 46 Russian electricity distribution entities with a dynamic investment model using the system generalized method of moments and addressing potential endogeneity issues. We show that, despite the noncredible regulatory policy, the transition from short-to long-term regulation had a positive and significant effect on the investment rate of regulated entities. The specific long-term regulation design applied in Russia from 2008 to 2017 (either rate-of-return or price cap) had no effect on the investment rate. These results are important for the introduction of changes in regulatory frameworks in developing countries. Keywords: Electricity distribution grids; Reforms; Rate-of-return regulation; Incentive regulation; Long-term tariff regulation; Russia (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:138:y:2020:i:c:s0301421520300367 DOI: 10.1016/j.enpol.2020.111276 Access Statistics for this article Energy Policy is currently edited by N. France More articles in Energy Policy from Elsevier |
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