Greater than the sum: On regulating innovation in electricity distribution networks with externalities

Vítor Marques, Paulo Moisés Costa and Nuno Bento

Utilities Policy, 2022, vol. 79, issue C

Abstract: To modernize distribution networks and enable the energy transition, we need to understand the most appropriate regulatory approach. A set of new technologies with positive externalities challenge the traditional regulatory models. We develop a decision model to assess firms' incentives to invest in new technologies under different regulatory schemes that consider externality effects. Results show that regulatory schemes under which companies retain the gains (or losses) of achieving (or not) efficiency targets more effectively promote innovation investments that reduce network costs. However, a case-by-case approach should be preferred for technologies whose benefits go mostly beyond the network activities.

Keywords: Regulation; Innovation; Externalities (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0957178722000820
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:juipol:v:79:y:2022:i:c:s0957178722000820

DOI: 10.1016/j.jup.2022.101418

Access Statistics for this article

Utilities Policy is currently edited by Beecher, Janice

More articles in Utilities Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().