On the use of 'adders' by public utility commissions

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Author: John Tschirhart
Date: Jan. 1994
From: The Energy Journal(Vol. 15, Issue 1)
Publisher: International Association for Energy Economics
Document Type: Article
Length: 2,863 words

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Abstract :

Public utility commissions are using 'adders' as a state program for measuring welfare and environmental damage cost. However, some critics are questioning the validity of adders as a marketable permit program. An analysis of the use of adders revealed that it leads to potential welfare loss by veering away from the first-best pricing strategy. To avoid this, the government must determine the possible sources of welfare loss before adders are used.

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Gale Document Number: GALE|A15351097