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Regulation
The transmission of power over long
distances is a natural monopoly market and, as
such, governments regulate the market to ensure
that system operators maintain standards and do
not over inflate prices.
Important issues controlled by regulation
are:
- Security of supply, so that power
is always available;
- Quality of supply, so that the
voltage and frequency are stable and that voltage
spikes do not damage equipment; and
- Cost, so that a fair rate is
charged for the service of transmission.
To control these issues, regulators
apply a range of controls to areas such as maintenance,
capital investment allowances, operating cost
allowances, investment returns and asset lifetimes.
Choose from the topics below to
learn more about how regulators work to ensure
that consumers' interests are protected, whilst
investors are able to make fair returns on their
investments.
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