Econometric methods for life-testing of capital units and results for regulated public utilities

Thesis/Dissertation · Sat Jan 01 00:00:00 EST 1983

OSTI ID:6892615

Schiffman, D A

The dissertation pertains to regulated public utilities that purchase capital units when the service lives of these units are random. Chapter II develops the econometric tools needed to analyze the data generated in such an instance. Results concerning the existence, consistency and asymptotic normality of a maximum likelihood estimator are derived. Chapter III contains a small model of a regulated public utility. Key components are assumptions of a fixed capital stock, random served lives for capital units, a tax environment where current tax laws concerning depreciation expense and investment tax credits are considered and a regulatory constraint of the type contained in the classic literature of Averch and Johnson (1962). Objectives are established for both regulatories and investors. It is assumed that each of these economic agents chooses from units which differ in terms of efficiency, purchase price, and durability. It is demonstrated that the objectives of regulators and investors may be different with respect to the choice of capital units, depending on current tax laws, and that this phenomenon is related to the results of Averch and Johnson. Chapter IV contains an application. Data were obtained for power transformers and the objectives of regulators and investors were evaluated. It was shown that differences in the expected service lives of these units is a key consideration.

• OSTI ID: 6892615
• Resource Relation: Other Information: Thesis (Ph. D.)
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING
POLICY AND ECONOMY
32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION
PUBLIC UTILITIES
CAPITAL
REGULATIONS
ECONOMIC ANALYSIS
EQUIPMENT
SERVICE LIFE
ECONOMICS
290200* - Energy Planning & Policy- Economics & Sociology
296000 - Energy Planning & Policy- Electric Power
320603 - Energy Conservation
Consumption
& Utilization- Municipalities & Community Systems- Public Utilities- (1980-)