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Issues in Infrastructure Pricing

Bureau of Industry Economics research report

This report was released in August 1995.

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Contents

Preliminaries
Cover, Copyright, Foreword, Contents, Executrive summary

1   Introduction
1.1   Infrastructure in Australia
1.2   Infrastructure reform
1.3   The issues to be examined

2   Efficient infrastructure pricing
2.1   What is efficient pricing
2.2   The applicability of marginal cost pricing to infrastructure pricing
2.3   Information needs
2.4   A practical application of different pricing approaches
2.5   Conclusion

3   Community service obligations
3.1   What is a CSO?
3.2   Funding CSOs through cross-subsidies
3.3   Alternative methods of funding CSOs
3.4   Measuring the cost of CSOs
3.5   Costing CSOs: a practical example
3.6   Conclusion

4   Rate of return targets and efficient pricing
4.1   The role of rate of return targeting
4.2   What is the appropriate measure of the rate of return?
4.3   Asset valuation
4.4   Setting rate of return targets
4.5   Conflicts between efficiency and RoR targeting
4.6   Conclusion

5   Limiting monopoly pricing
5.1   Competition in infrastructure markets
5.2   Regulation to limit monopoly pricing
5.3   The cost of regulation
5.4   Conclusion

6   Intergovernmental relations: implications for infrastructure pricing
6.1   Setting the scene: intergovernmental financial arrangements
6.2   Implications for infrastructure pricing and provision
6.3   Encouraging more efficient infrastructurepricing under a federal system
6.4   Compensation arrangements and their impact on infrastructure pricing
6.5   Conclusion

Appendix 1   The economic rate of return for Tollroad Tunnel Corporation

References

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