Effects Comparison of Peak-Load Price under Price Cap Regulation

The reform of electricity price is the core of electricity deregulation, and reasonable price should be an organic unity of price level and price structure. The examination of the effects of peak-load price under different price cap forms dawns on us that the price cap regulation has the effects of cost-recovery. Comparing with absolute price cap regulation, the relative price cap regulation is more advantageous, and the peak-load price in such regulation tends to be the Ramsey Price which can maximize social welfare as much as possible. At the same time, for relative price cap regulation, no matter what adopting Laspeyres price index and Paasche price index, the effects are identical.