Crowley and Meitzen Measure the Price Impact of Price-Cap Regulation

Categories: Performance-Based Ratemaking

October 14, 2021 - Nicholas Crowley and Mark Meitzen

In October 2021, the journal Utilities Policy published Nick Crowley and Mark Meitzen’s paper “Measuring the price impact of price-cap regulation among Canadian electricity distribution utilities.” Crowley and Meitzen compare rate outcomes between a control group of firms regulated under the traditional rate-of-return method and a group of firms under price caps in Alberta and Ontario. The authors confirm the expectations of economic theory, finding a downward effect on the annual escalation of customer rates under price-cap regulation.