Multi-period multi-product regulatory schemes for electricity distributors are presented, based on cost information from a productivity analysis model and an agency theoretical decision model. The proposed schemes are operational and demonstrate considerable advantages compared to the popular CPI-X revenue cap regulation. The schemes avoid arbitrariness, excessively high or negative informational rents as well as ratchet effects and they promote rapid productivity catch-up by making full use of available data. More generally, the paper contributes to the theoretical unification between firm-based Data Envelopment Analysis (DEA) productivity models and micro-economic reimbursement theories. JEL Classification: D24, D82, L12, L51, L94

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District heating, the conversion of primary energy into distributed thermal energy and possible electric energy, is a challenge to regulate. In addition to the ever present asymmetric information in any su¢ciently complex activity, some of the inputs for district heating, such as excess process heat, have arbitrary valuation. This study concerns the most developed European district heating and cogeneration system, the Danish. By assessing environmental and economic e¢ciency, the impact of governmental, market and managerial imperfections are estimated. The principal methodological base is the additive Data Envelopment Analysis model with extensions. The paper ends with some policy suggestions.

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