Book contents
- Frontmatter
- Contents
- Preface
- Acknowledgments
- 1 The Scope of Regulatory Bargaining
- PART I EXTENDING INCOMPLETE BARGAINS FROM THE ECONOMICS OF THE FIRM TO PUBLIC GOVERNANCE
- 2 Regulatory Bargaining and the Stability of Natural Monopoly Regulation
- 3 The Incompleteness of Regulatory Law: Moving Beyond the “Small World” of Natural Monopoly Regulation
- 4 Refin(anc)ing Retail Service Obligations for the Competitive Environment
- PART II INCOMPLETE REGULATORY BARGAINS, INSTITUTIONS, AND THE ROLE OF JUDICIAL REVIEW IN DEREGULATED INDUSTRIES
- References
- Index of Primary Legal Authorities
- Subject Index
4 - Refin(anc)ing Retail Service Obligations for the Competitive Environment
Published online by Cambridge University Press: 11 July 2009
- Frontmatter
- Contents
- Preface
- Acknowledgments
- 1 The Scope of Regulatory Bargaining
- PART I EXTENDING INCOMPLETE BARGAINS FROM THE ECONOMICS OF THE FIRM TO PUBLIC GOVERNANCE
- 2 Regulatory Bargaining and the Stability of Natural Monopoly Regulation
- 3 The Incompleteness of Regulatory Law: Moving Beyond the “Small World” of Natural Monopoly Regulation
- 4 Refin(anc)ing Retail Service Obligations for the Competitive Environment
- PART II INCOMPLETE REGULATORY BARGAINS, INSTITUTIONS, AND THE ROLE OF JUDICIAL REVIEW IN DEREGULATED INDUSTRIES
- References
- Index of Primary Legal Authorities
- Subject Index
Summary
The traditional natural monopoly paradigm may have viewed electricity itself as a public good. In a competitive market, however, certain public goods previously associated with electric power will not necessarily be provided on their own. A challenge for deregulated markets is to evaluate how these public goods will continue to be offered within a competitive market. This chapter uses a bargaining perspective to address the provision of an important public good – universal access to retail power – in deregulated electric power markets.
Universal service obligations can be implemented in a deregulatory environment, notwithstanding the elevation of private interests over public welfare in the everyday working of deregulated markets. Along these lines, a government relations bargaining framework raises two new concerns for provision of this public good. First, it advises against the imposition of across-the-board ex ante service obligations, favoring instead cautiously adopted and narrowly tailored service mandates for deregulated markets. Second, to the extent that service obligations are not efficiency promoting, the government relations bargaining approach makes trade-offs between efficiency and other goals more explicit in the political process. In this sense, a government relations bargaining approach is more attentive to political accountability than previous accounts of public good provision in the industry.
During the twentieth century, the privately owned electric utility was allowed to operate as a monopolist, but it also had certain responsibilities: It submitted to price regulation and assumed obligations to extend service to all customers within its geographic service territory and to continue providing service, once service had commenced (Haar & Fessler, 1986).
- Type
- Chapter
- Information
- Regulatory Bargaining and Public Law , pp. 71 - 92Publisher: Cambridge University PressPrint publication year: 2005
- 1
- Cited by