Stochastic semi-nonparametric frontier estimation of electricity distribution networks: Application of the StoNED method in the Finnish regulatory model

Kuosmanen, Timo

doi:10.1016/j.eneco.2012.03.005

Cited by 134 publications

(87 citation statements)

References 27 publications

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“…Given its complexity, it is common to model electricity distribution as a multiple output technology including total distribution volumes, peak demand, customers served, and/or distribution network length. However, while all these output attributes are important, their inclusion also tends to cause serious multicollinearity problems in estimation (Arocena et al, 2012;Kuosmanen, 2012). Given that the purpose of this paper is primarily methodological, we chose a more parsimonious model for two reasons.…”

Section: Empirical Applicationmentioning

confidence: 99%

Estimating economies of scale and scope with flexible technology

et al. 2016

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Section: Empirical Applicationmentioning

confidence: 99%

Estimating economies of scale and scope with flexible technology

et al. 2016

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“…The Finish and Norwegian regulators have included the estimated socio-economic cost of outages (i.e., the value of energy not served due to outages) as part of the total cost for efficiency benchmarking (Kuosmanen, 2012). Outage costs are also used as an instrument to evaluate the social cost of service, including service quality.…”

Section: Network Security-related Costsmentioning

confidence: 99%

Incentive regulation and utility benchmarking for electricity network security

Nepal

Jamasb

2015

Economic Analysis and Policy

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Use policyThe full-text may be used and/or reproduced, and given to third parties in any format or medium, without prior permission or charge, for personal research or study, educational, or not-for-prot purposes provided that:• a full bibliographic reference is made to the original source • a link is made to the metadata record in DRO • the full-text is not changed in any way The full-text must not be sold in any format or medium without the formal permission of the copyright holders.Please consult the full DRO policy for further details. AbstractThe incentive regulation of costs related to physical and cyber security in electricity networks is an important but relatively unexplored and ambiguous issue. These costs can be part of cost efficiency benchmarking or, alternatively, dealt with separately. This paper discusses the issues and proposes options for incorporating network security costs within incentive regulation in a benchmarking framework. The relevant concerns and limitations associated with the accounting and classification of network security costs, choice of cost drivers, data adequacy and quality and the relevant benchmarking methodologies are discussed. The analysis suggests that the present regulatory treatment of network security costs using benchmarking is limited to being an informative regulatory tool rather than being deterministic. We discuss how alternative approaches outside the benchmarking framework, such as the use of stochastic cost-benefit analysis and cost-effectiveness analysis of network security investments can complement the results obtained from benchmarking.Keywords: benchmarking; network security; incentive regulation; exceptional events JEL Classification: L94, L51, L98 *Corresponding author. School of Business, Charles Darwin University, Email: rabindra.nepal@cdu.edu.au, Phone: +61 (0)

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“…The regulatory model changed because the estimate of the frontier F should be a more reliable benchmark than the firm-specific T E estimates (cf. Kuosmanen (2012a)). However, the other European electricity regulation systems still rely on the firm-specific efficiency estimator.…”

Section: Performance In Terms Of the Estimated Production Frontiermentioning

confidence: 99%

The StoNED Age: The Departure into a New Era of Efficiency Analysis? – A Monte Carlo Comparison of StoNED and the 'Oldies' (SFA and DEA)

Andor

Hesse

2013

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The working papers published in the Series constitute work in progress circulated to stimulate discussion and critical comments. Views expressed represent exclusively the authors' own opinions and do not necessarily refl ect those of the editors. Terms of use: Documents in Ruhr Economic Papers #394

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Stochastic semi-nonparametric frontier estimation of electricity distribution networks: Application of the StoNED method in the Finnish regulatory model

Cited by 134 publications

References 27 publications

Estimating economies of scale and scope with flexible technology

Estimating economies of scale and scope with flexible technology

Incentive regulation and utility benchmarking for electricity network security

The StoNED Age: The Departure into a New Era of Efficiency Analysis? – A Monte Carlo Comparison of StoNED and the 'Oldies' (SFA and DEA)

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