Impact of price regulation methodology on the managerial decisions of the electricity DSO

Electricity distribution network companies' activities and managerial decisions depend substantially on the applied regulatory methodology. The impact of different regulatory methodologies on different results like security of supply, investors' attractiveness and network tariffs level has been evaluated. The rate of return method has been used for the regulation of the electricity network tariffs in Estonia since 2004. The results of 10-year regulation period have been evaluated in comparisons to other methods available.