No barriers to investment in electricity and gas distribution networks through incentive regulation

DIW weekly report 6/2015, pp. 98-104

Since the beginning of 2009, energy supply in Germany has been subject to incentive regulation, which is intended to ensure the efficient operation of electricity and gas networks. However, it is unclear how the changed regulatory framework will affect the investment behaviour of network operators.

Against this background, the present study empirically analyses the investment activities of network operators for the period from 2006 to 2012. Central questions are whether the introduction of incentive regulation from 2009 onwards can be attributed an empirically verifiable influence on investment activity and whether this influence is due to the introduction of incentive regulation per se or its specific design.

As a result, a positive effect on investment activity can be established with the introduction of incentive regulation, which is determined in particular by the specific design of the regulation.

DIW weekly report 6/2015 (477 KB)

DIW weekly report 6/2015, S. 98-104 (ENG 656 KB)

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