"Spread" in Electric Utility Rate Structures
Volume: Volume 6, No. 1
Issue: Spring 1975
Pages: pp. 377-387
Authors: Milton Kafoglis and Charles Needy
Title: "Spread" in Electric Utility Rate Structures
Abstract: This brief article seeks empirically to measure rate differentials in electric utility rate structures. A Gini coefficient is developed which measures the degree of inequality in rates charged to various electric customer classes. A high Gini coefficient is associated with large rate differences while a low coefficient suggest a flatter rate structure. This index represents a first effort to summarize rate relationships and is intended to be suggestive rather than definitive. Though interpretation of the index would involve bold assumptions, it does suggest an empirical approach in an area which has been theoretical and speculative.
JEL Classification
Regulation of Public Utilities (6130)