Title :
Is capacity cost allocation according to long-run marginal costing principles correct?
Author :
Dingley, Charles
Author_Institution :
Dept. of Electr. Eng., Cape Town Univ., Rondebosch, South Africa
Abstract :
In the long-run marginal cost approach, all power system capacity costs are charged to peak-period users. This paper presents a simple “shared-cost” model as the basis for a fundamental discussion of capacity-cost allocation. Based on this analysis, the paper suggests that the long-run marginal cost approach might not be correct
Keywords :
costing; economics; tariffs; electricity tariffs; long-run marginal cost approach; peak-period user charges; power system capacity costs; shared-cost model; Africa; Australia; Cities and towns; Costing; Costs; Pricing;
Conference_Titel :
AFRICON, 1996., IEEE AFRICON 4th
Conference_Location :
Stellenbosch
Print_ISBN :
0-7803-3019-6
DOI :
10.1109/AFRCON.1996.563030