Coordinated electricity pricing and planning

An electricity industry consists of a supply side (the electricity supply industry, including third party generation) and a demand side (electrical equipment operated by consumers). Decisions about end-use requirements for heating, lighting, mechanical power and so on determine the demand for electrical energy, through the investment in and operation of electricity consuming equipment. These decisions are influenced by many factors, particularly electricity prices and their relationship to those of competing energy forms, such as natural gas. Consumer perceptions of environmental impacts may be increasingly important in the future. Countries around the world are searching for improved structures for national electricity industries that take into account recent developments. The authors outline a new planning and pricing framework for the electricity industry that would facilitate progress in these areas