The impact of a proposal to deregulate electric generation on the required rate of return for a utility can be inferred from the proposal's impact on the utility's dividend yield, given some admittedly strong assumptions about risk timing and related matters. We use the case of the April, 1994...

It is common to assert that utility investors are compensated in the allowed rate of return for the risk of large disallowances, such as arise for investments found imprudent or not `used and useful'. However, this book develops a new theory of asymmetric regulatory risk that shows that...