Price Level and Tariff Design
- Steps - What are the key steps for designing an effective tariff structure?
- Price Path - How does a regulator or a utility design a tariff structure that will gradually align prices with efficient costs over time?
- Cost pass-throughs - Should bulk tariffs be transferred directly to final consumers through adjustment clauses or comparable pass-through mechanisms?
- Peak-load pricing - How can a regulator develop incentives to reduce peak demands, which would require capacity expansion?
- Challenges of incentive regulation – What are the key challenges that need to be addressed when introducing incentives?
- Promoting efficiency – To what extent do incentives actually lead to improved efficiency?
- Efficiency measures – How do you measure the efficiency of service provision?
- Efficiency targets – What are reasonable efficiency targets?
- Rewards for cost-containment – What incentives should a regulator introduce in order to promote cost-containment?
- Performance incentives – How can regulators encourage improvements in specific dimensions of performance?
- Penalties for non-compliance – What penalties are most effective when the operator is in non-compliance with regulatory rules (e.g. for providing data, setting prices, or meeting targets)?
- Incentives for improved performance – How can a regulator develop incentive to discourage energy / water losses?
- Promoting investments – How can regulatory incentives be introduced to promote investment?
- Coverage – How can regulators establish incentives for service expansion?