Planification Et Tarification : Calcul Theorique Et Pratique Des Couts Marginaux De Production a E.D.F.

Penz, Philippe

doi:10.1111/j.1467-8292.1979.tb00841.x

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“…Marcel Boiteux's seminal work on marginal-cost pricing [4] and peak-load pricing [3,6] was made as operational as it could be by EDF's economic departments using the given information and means available at the beginning of the 1960s [18,36]. Tariffs construction was not a mere computation of the marginal costs expectation.…”

Section: The Economic Model Of Regulated Electric Monopolymentioning

confidence: 99%

Long-Term Risk Management for Utility Companies: The Next Challenges

Aïd

2010

Int. J. Theor. Appl. Finan.

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Since the energy markets liberalisation at the beginning of the 1990s in Europe, electricity monopolies have gone through a profound evolution process. From an industrial organisation point of view, they lost their monopoly on their historical business, but gained the capacity to develop in any sector. Companies went public and had to upgrade their financial risk management process to international standards and implement modern risk management concepts and reporting processes (VaR, EaR...). Even though important evolutions have been accomplished, we argue here that the long-term risk management process of utility companies has not yet reached its full maturity and is still facing two main challenges. The first one concerns the time consistency of long-term and mid-term risk management processes. We show that consistencies issues are coming from the different classical financial parameters carrying information on firms' risk aversion (cost of capital and short-term risk limits) and the concepts inherited from the monopoly period, like the loss of load value, that are still involved in the utility company decision-making process. The second challenge concerns the need for quantitative models to assess their business model. With the deregulation, utilities have to address the question of their boundaries. Although intuition can provide insights on the benefits of some firm structures like vertical integration, only sound and tractable quantitative models can bring answers to the optimality of different possible firm structures.

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Section: The Economic Model Of Regulated Electric Monopolymentioning

confidence: 99%

Long-Term Risk Management for Utility Companies: The Next Challenges

Aïd

2010

Int. J. Theor. Appl. Finan.

View full text Add to dashboard Cite

show abstract

Planification Et Tarification : Calcul Theorique Et Pratique Des Couts Marginaux De Production a E.D.F.

Cited by 1 publication

References 0 publications

Long-Term Risk Management for Utility Companies: The Next Challenges

Long-Term Risk Management for Utility Companies: The Next Challenges

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