Regulatory Schemes and Investment Behavior in Transmission of Electricity: The Case of Argentina Regulatory Schemes and Investment Behavior in Transmission of Electricity: The Case of Argentina

The objective of this paper is to analyze the impact of the Argentinian regulation of the expantion of the network for high voltage electricity. Argentina reorganized its electricity industry in 1992, including the transmission network and adopted a new regulatory framework. The result for investment in transmission have been mixed so far. The new regulation apparently have not triggered the investment necessary to eliminate local bottlenecks in the transmission system. The persistence of this problems hinders the capability of the industry to ensure reliable and economical electricity in the long run. This paper attemps to explain the reasons for these mixed results. The objective of this paper is to analyze the impact of the Argentinian regulation of the expantion of the network for high voltage electricity. Argentina reorganized its electricity industry in 1992, including the transmission network and adopted a new regulatory framework. The result for investment in transmission have been mixed so far. The new regulation apparently have not triggered the investment necessary to eliminate local bottlenecks in the transmission system. The persistence of this problems hinders the capability of the industry to ensure reliable and economical electricity in the long run. This paper attemps to explain the reasons for these mixed results.