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COST OF CAPITAL ESTIMATION FOR ENERGY NETWORK UTILITIES: REVISITING FROM THE PERSPECTIVE OF REGULATORS

Dokuz Eylul University Faculty of Economics and Administrative Sciences Journal

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Title COST OF CAPITAL ESTIMATION FOR ENERGY NETWORK UTILITIES: REVISITING FROM THE PERSPECTIVE OF REGULATORS
COST OF CAPITAL ESTIMATION FOR ENERGY NETWORK UTILITIES: REVISITING FROM THE PERSPECTIVE OF REGULATORS
 
Creator GÖZEN, MUSTAFA
 
Description Estimating the cost of capital for energy network utilities is critical because it directly effects decisions energy regulators make. The regulators have to estimate and allow a reasonable rate of return for network utilities as part of their duties under national laws, while balancing the protection of consumers and allowing an acceptable return to network investors. There is no generally accepted method applicable in all countries. Consequently, there is a need to review the estimation methods from the regulator's perspective, especially how to estimate an acceptable return if the network utility has an ownership structure with different return interests. Unfortunately, the available models provide either industry based or countrywide cost of capital values and do not consider different return expectations of network utility shareholders.
Estimating the cost of capital for energy network utilities is critical because it directly effects decisions energy regulators make. The regulators have to estimate and allow a reasonable rate of return for network utilities as part of their duties under national laws, while balancing the protection of consumers and allowing an acceptable return to network investors. There is no generally accepted method applicable in all countries. Consequently, there is a need to review the estimation methods from the regulator's perspective, especially how to estimate an acceptable return if the network utility has an ownership structure with different return interests. Unfortunately, the available models provide either industry based or countrywide cost of capital values and do not consider different return expectations of network utility shareholders.
 
Publisher Dokuz Eylul University Faculty of Economics and Administrative Sciences Journal
Dokuz Eylül Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi
 
Contributor —
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Date 2013-06-11
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
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Format application/pdf
 
Identifier https://iibfdergi.deu.edu.tr/index.php/cilt1-sayi1/article/view/292
 
Source Dokuz Eylul University Faculty of Economics and Administrative Sciences Journal; Cilt 26, Sayı 2 (2011): CİLT:26 SAYI:2
Dokuz Eylül Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi; Cilt 26, Sayı 2 (2011): CİLT:26 SAYI:2
2147-7973
1302-504X
 
Language tur
 
Relation https://iibfdergi.deu.edu.tr/index.php/cilt1-sayi1/article/view/292/pdf_272