Network depreciation and energy market disruption: Options to avoiding passing costs down the line

Regulatory economic theory and practice suggest a range of hypothetical options. The particular characteristics of the current regulatory framework have implications for what will be a workable option. Analysis of the set of options suggests that the primary goal of the economic regulatory regime, the long-term interests of consumers, may be promoted by the more active use by economic regulatory bodies of flexible depreciation allowance provisions, and movement to more flexible regulation.