Performance-Based Ratemaking: Opportunities and Risks in a Competitive Electricity Industry
Performance-based ratemaking is increasingly being considered an alternative to traditional regulation within a more competitive electricity industry. If designed well, PBR can provide better financial incentives than exist today. In “Performance-Based Ratemaking: Opportunities and Risks in a Competitive Electricity Industry,” published in The Electricity Journal, Tim Woolf and Julie Michals discuss how regulators should carefully design PBR mechanisms that incorporate long-term public policy objectives as well as short-term profit incentives. Access the article here: http://www.sciencedirect.com/science/article/pii/1040619095900187.