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The Demand for Electricity Services and the Quality of Supply

By Romesh Dias-Bandaranaike and Mohan Munasinghe

Abstract

The spiraling costs of energy within the last decade have stimulated renewed interest in the increased efficiency of energy production and consumption.' Electricity is a relatively mature sector where considerable theoretical work on the economic aspects has been carried out since the 1950s.2 While the microeconomic principles underlying optimal investment planning and pricing policy have received much attention in the recent literature, less effort has been devoted to the effects of quality of supply and output reliability.

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