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Funding for Universal Service Obligations in Electricity Sector: the case of green power development


Author Info

  • Favard, P.
  • Mirabel, F.
  • Poudou, J.-C.


The process of deregulation in network industries, in particular in the electric sector, raises the problem of financing the Universal Service Obligations (USO) corresponding to the production, transport and distribution operations. In this paper, we study three ways of funding for an USO of production, especially the green electricity development: the funding with cross-subsidies, the implementation of a fund (funding by a tax) and finally a voluntary funding system by direct subscriptions of consumers. We notably show that this last one Pareto dominates mostly, from a welfare point of view, the other scenarios.

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Bibliographic Info

Paper provided by LASER (Laboratoire de Science Economique de Richter), Faculty of Economics, University of Montpellier 1 in its series Cahiers du LASER (LASER Working Papers) with number 2002.06.

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Length: 36 pages
Date of creation: 2002
Date of revision:
Handle: RePEc:mop:lasrwp:2002.06

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Postal: Université de Montpellier 1, Faculté des Sciences Economiques, LASER, Rue Raymond Dugrand - Espace Richter, CS 79606, 34960 Montpellier Cedex 2, France
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