Investment incentives: regulation of the Finnish electricity distribution

Investments into the electricity distribution network are needed to support competition and to guarantee the security of supply as well as a good quality of electricity. The aim of this paper is to study the ex post regulatory system in Finland in context of investment incentives. The second objective is to study how the investments in the sector have developed after the liberalisation and what seem to be the most important factors influencing investments in light of empirical information and how regulation affects them. The investment volumes vary much between years but on average, no drastic developments have taken place.