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https://doi.org/10.37798/2005543434

ECONOMIC REGULATION METHODS IN ELECTRIC POWER SECTOR

Tomislav Gelo orcid.org/0000-0002-4804-4315 ; University of Zagreb Faculty of economics & business
Ivona Štritof ; Croatian Energy Regulatory Agency (HERA)

Sažetak

Regulation in electric power sector has been created because it was considered that mechanism of free market competition, i.e. Smith’s invisible hand will not influence optimization of market relationships and protection of interest on the consumer side in the case of natural monopolies like transmission and distribution of electric energy. Therefore, a significant number of countries decided to make a legal framework and operation conditions of natural monopolies in power sector. Thus, regulation of electric power activities was introduced with the goal to protect consumer and investor interests by protecting the invested capital, as well as obtaining the framework that is common in completely open market competition. At the same time, to obtain independency and transparency of the processes the states organize regulatory bodies that define relationships among all participating parties in non- discriminatory and transparent way.In the paper a review of basic methods of economic regulation is given, which are used in the states of the European Union (15) as well as their advantages and disadvantages. At the same time some guidelines and preconditions are given in the case of economic regulation application on the Croatian electric power sector.

Ključne riječi

regulatory body; methods of economic regulation; rate of return regulation; incentive based regulation; transmission and distribution of electric energy

Hrčak ID:

306218

URI

https://hrcak.srce.hr/306218

Datum izdavanja:

15.5.2005.

Posjeta: 523 *