Utility diversification
A review of the available evidence of the effect of diversification on a utility's financial attractiveness suggests that diversified gas companies have higher earnings, better credit ratings, and more marketable securities than do the less diversified utilities. Regulatory commissions must, however, always be alert to ways in which a company's unregulated activities might adversely affect consumers of the regulated service. Once assured that the service customers are adequately protected, the commission should neither review the specific ventures of unregulated subsidiaries nor become involved in regulating their security issuances or dividend payments. In general, utility diversification should be subject only to managerial discretion and the discipline of the market.
- OSTI ID:
- 6570195
- Country of Publication:
- United States
- Language:
- English
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