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ElectricityratestructuredesigninLatinAmerica:wheredowestand?whereshouldwego?/FernandoNavajas.

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ElectricityratestructuredesigninLatinAmerica:

Wheredowestand?Whereshouldwego?

FernandoNavajas*

Abstract

Thispaperreviewssomecriticalissuesforaddressingthestructureofelectricitytariffsforulteriorpurposesofpolicyresearchagenda.Startingfromeconomicprinciplesbehindelectricitytariffdesign,thispaperaskswhatoptionsaheadLatinAmericahasintermsofimprovingelectricitytariffdesignfromaheterogeneousstatusquo,wheretrade-offsamongcostrecovery,costreflectivityandaffordabilitystandout.Optionslooklikeanavenueforimprovingcostrecoverythroughbetterwholesalemarketdesignandregulation;moveoutsideexcessvolumetricpricingandtowardsfixedandcapacitycharges;reduceexcessiveincreasingblockpricing;promotemeteringandregulatoryflexibilityformenupricingwithoptionalschemesandguaranteedbills;fosterflexibilityfornewcustomerclusteringandpricingtoaccommodateinnovationintheenergytransition;attendaffordabilitywithlumpsumtransfersthroughdifferentiatedfixedchargesandtaxesandreformtaxationtocoordinatetariffformatreformacrossdifferentregulatoryjurisdictions.Aboveallthesedimensions,countriesshouldcoordinateoncommoninformationstandardsonthelevelandstructureofelectricityrates.

JELclassifications:L51,L94,L98,Q41,Q48

Keywords:electricitytariffs,rateformat,increasingblocks,fixedcharges,supplycoststructure,customerdefinition,taxes.

*Professor,DepartmentofEconomics,FacultyofEconomicScience,UniversityofBuenosAires.ChiefEconomist,

FundacióndeInvestigacionesEconómicasLatinoamericanas(FIEL),Córdoba637,BuenosAiresC1054AAF,

navajas@.ar

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Introduction

Electricitypricingisundergoingafasttransformationinlinewiththesubstantialstructuralchangesembeddedintheenergytransition.SeenfromahistoricalperspectivethatstartedinthepostWWIIperiodunderdifferentorganizationalforms(HansenandPercebois,2017),electricitypricingwillbereformedtoaccommodatetwofundamentalshiftsinthebasicgrammarofcostsandprices.First,marginalpriceswillconvergetoverylowvalues(ifnotzero,asperhapsexaggeratedbyHeal,2021)evenwithmoretimeandspacedependencyorvolatility.Second,fixedchargeswillemergeasmuchmoreimportantduetothemoresignificantroleofnetworkcostsinadecentralizedsystemthatincorporatesdiversedistributedenergyresources.Thosesignificantvariationsingenerationandlocationalcumcongestioncostsmovethetrendtowardstimeofusepricingschemesthatnowfacemuchlessfrictionsortransactioncosts,duetotheastonishingimpactofdigitalization.

Thisgiganticshiftputsalotofpressureforreformofthestatusquoofelectricitypricing,particularlyinemergingeconomieslikethoseofLatinAmericaandtheCaribbean(LAC),wherethe“pricingcode”isstillconceivedintheoldparadigm,extremelybiasedtowardsvolumetriccomponentswithoutacorrespondencewithcostscomponents,unrelatedtotime-varyingdifferentiationandwithanexcessofdiscriminatorypricingembedded,inmanycountries,inanoveruseofblockpricing1.AnnexAlistofficialandcommercialsourcesin12LACcountrieswheretheformatoftariffstructuresinelectricitycanbecollected.

Inaddition,LACistrappedinaregimewhereaffordabilityisperhapsaprimeimpedimentforanefficientrebalancingtowardsfixedcharges,resemblingtheequity/efficiencydebateontwo-parttariffs(Feldstein,1972;BrownandSibley,1986;seeanapplicationinNavajasandPorto,1990andmorerecentlyinBorensteinandDavis,2010).TheinefficienttrapofcurrentelectricitypricingstructuresinLACiswellillustratedinrecentpapersbyMcRaeandWollak(2021)onColombia,Hancevic,NuñezandRosellón(2022)onMexico,andUrbiztondo,BarrilandNavajas(2020)onArgentina.Allthreepaperspresenttariffdesignpitfallsthatneedtoberevertedtobetteraccommodatetheenergytransition.

LACcountriesdonothaveextremelyhighelectricitypricesonaveragecomparedtootherregions.Inaddition,thelevelizedcostofelectricity(LCOE)inLACisrelativelylow,mainlyduetothehighpresenceofhydropowerelectricitygenerators(seeFigure9insection6below).However,theaverageburdenofelectricitybillsonhouseholds’totalexpenditureorincomeisveryhigh(seeCavallo,PowellandSerebrisky,2020andMejdalanietal,2022).Beyondthedrawbackofhighpovertyandlowhouseholdpurchasingpower,electricitypricescannotaccommodatetoaffordabilityduetoinefficienciesaccumulatedinpublic

1Evidenceshowsthatthisisnotacompletelyuniformfeatureintheregion,with,forexample,Brazil,ChileandColombianotdisplayingblockpricing.HoweveritisratherpervasiveinmanycountriessuchasArgentina,Bolivia,CostaRica,ElSalvador,Mexico,ParaguayandUruguay.Thisincludesblockpricingofvolumetriccomponentsandinsomecases(Argentina,Bolivia,ElSalvador,PeruandUruguay)ofdifferentiatedfixedcharges.TheArgentinecaseillustratedinsection5isperhapsthemostsalientcase.

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enterprises,theregulatorysystemperformance(duetohighcostofcapitalandlackofregulatorycredibility)andanexcessburdenofelectricitytaxation.Therefore,affordabilityproblemscreatethreeproblemsforelectricityrateperformanceinLAC:First,theyaffecttarifflevelsposingproblemsforcostrecoveryandcostreflectivity;second,theygiverisetoexcessrebalancingagainstbusiness;third,theyleadtoexcessproliferationofinefficientdiscriminationacrosshouseholds(seeNavajas2006,forArgentina).

AgainstthisbackdropandgivenstatusquoinLAC(whichisquiteheterogenousintermsofregulatoryinstitutions,pricingpracticesandaffordabilityproblems),ourmainpurposeistocontributetotheshapingofaninformationandpolicyresearchagendaintheregion.Wedosobydiscussingprinciplesandguidelinesoftariffdesignfromamethodologicalangle;separatingconceptuallytariffelementsbetweenvariableandfixedcomponents;providingadiscussionofthecorrespondenceoftariffswithcostcategories;isolatingtariffsfromothercomponentsofend-userpricesignalssuchastaxesandcharges;discussingelementsofconsumertypeclassification;contributingtotheagendaofreformofpricingandtariffdesigninelectricityandtheoptionsoftrade-offsopentotariffreformandsuggestingcomponentsofadatasetandinformationrequirementsforsuchanagenda.

Thispaperisorganizedinthefollowingsections.Insection2,wereviewsomeprinciplesforrate(tariff)designwithaneyeonwhatwebelieveisLACelectricitytariffstatusquobiastowardselectricitytariffdesign.Insection3,wedealwiththedefinitionandcorrespondenceoftariffcomponentsandcostcategories,acentraltopicforthestudyofthecomparisonofthestructureofelectricitytariffs.Section4addressesthedefinitionofcustomertypesforthecomparisonoftariffstructures.Section5callsattentiononacoordinationproblembetweentariffs,chargesandtaxesacrossregulatoryjurisdictions.Section6summarizesourviewoftrade-offs,alternativescenariosandoptionsaheadforelectricitytariffprogresswithaneyeonrelevant,andusefulforpolicyguidance,comparisonsofelectricitytariffsinLAC.Section7concludeswithsomeremarks.

Relationshipwithrecentliterature.WerelatetotheissuesaddressedinarecentunpublisheddraftbyMejdalanietal(2022),butwithanemphasisonpricingprinciplesreceivedfromtheextensiveliteratureonoptimalutilitypricing.BorensteinandBushnell(2021)andseveralsupportingpapersarecloselyrelatedtoourapproachtocostreflectivityinelectricity.Wealsorelatetotheevidenceanddebateonnon-lineartariffsandaverageversusmarginalsignalsresponsebyconsumers(Borenstein,2009;Ito2014;ItoandZhang,2020;Shaffer,2020;Lavandeiraetal,2022)foritsimplicationstoevaluateexcessdifferentiationoftariffblocks(somethingfoundinNavajasandPorto,1990andBorenstein,2010fromdistributionalorwelfareperspectives).Oncoststructureissues,werelatetoACER(2021)approachonelectricitydistribution,whichisalsousefuloncustomertypeclassification.WealsodiscusspricingimplicationsofcoststructureenvisagedinBorenstein(2016),Perez-Arriagaetal(2017)andHelm(2017).FaruquiandTang(2021)provideanaccountofpracticesandtrendsinelectricitytariffdesignwhichalsomapsintocustomerclassificationissues.WearelinkedtopapersonLAC(McRaeandWollak,2020;Hancevic,Nuñezand

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Rosellon,2020andUrbiztondo,BarrilandNavajas,2020)thathavepointedoutelectricitytariffdesignproblemsthatleadtoexcessivevolumetricbiasortariffdifferentiation.WeusepreliminaryresultsfromNavajasandOlguin(2022)intermsoftheinformationaleffortstoevaluatetariffschedulesacrossdifferentjurisdictions.EvidenceoncarbonpricingmetricsrelevantforelectricitytariffreformistakenfromAhumada,Espina-Mairal,NavajasandRasteletti(2023).

2.Economicprinciplesbehindelectricityratedesign

Utilitypricingtheoryevolvedthroughtimeaccommodatingfirstprinciplestoinstitutional,regulatoryandtechnologicalchanges.Thistimeisnotdifferent:electricitypricingwasattheforefrontoftheseadvancesanditisonceagainleadingthechangeofparadigm.

Thiscurrentwavecanbeseenasthethirdoneintheadvancesofutilitypricingtheory.FirstwavewaspostWWIIwithadefactoequivalencebetweenoptimalindirectandutilitypricingprinciplesduetoverticallyintegratedpublicmonopolies.Marginalcostpricing,Ramseypricing,peak/off-peaktariffs,two-parttariffs2wereallsignificantadvanceswithmanycontributionsintheoryandpractice(seeTurveyandAnderson,1977forelectricitypricing).Thesecondwavewastheadaptationtoefficientorincentiveregulation,whereratedesignfollowsacost-of-serviceregulationapproach(seeWollak,2008)andpreviousadvancesonpricestructuresareincorporatedintothissetting(BrownandSibley,1986)butperfecting(especiallynon-linear)pricingmechanismsandaccountingforinformationalasymmetries(LaffontandTirole,1993;Wilson,1993).Dynamicpricing(i.e.pricesthatarereflectivetomarketconditions,liketime-of-use(TOU)orreal-timepricing(RTP)advancesmovedinthroughthissecondwave,althoughpracticewentbehind(or,perhaps,followedanotherroutefrom)theory,particularlyinLAC.

Thethirdwaveisnowongoingandnotyetcompleted,conceptuallyspeaking.Itstemsfromtheenergytransitionprocessandthefundamentalchangesinthestructureofcosts,decentralizationanduseofinformationtechnologies(digitalization).Itisdrivenbytwofundamentalshiftsinthebasicgrammarofcostsandprices:marginalpriceswillconvergetoverylowvalues(ifnotzero,asexaggeratedbyHeal,2021)andfixedchargeswillemergeasmuchmoreimportant,duetothetechnologicalshifttowardsrenewablegenerationandtothemuchmoresignificantroleofnetworkcostsinadecentralizedsystem(PerezArriagaetal,2017).Giventhis,andfromanappliedtheoryandpolicyperspective,therearetwofrontstoaddress,withimplicationsonratedesign.Oneisthedesignofwholesaleelectricity

2Glossaryfornon-economists:Marginalcostpricing:efficientopportunitycostpricingthatreflectsrelevantincrementalcosts.RamseyPricing:whenamultipricestructureneedstoaddressefficiencysubjecttosomeprofitorregulatory(cost-of-service)constraint,pricediscriminationcanproceedefficientlyleadingtoprice-(marginal)costmarginsthat(inversely)relatestotheelasticityofdemand,undersomeconditions.Peak/Off-Peak:Demandfluctuationsleadtopricesrespondingtodemandconditions;Two-Parttariffs:whenfixedcostsneedtobefinanced/coveredandtheinstrumentsallowtheuseofafixedcharge,then,atwo-parttariffcanbeefficientinnotdistortingthroughpositiveprice-costmarginsbutinsteadusethefixedcharge.Severalillustriousnamesineconomicsinthe20thcentury(HaroldHotelling,1938;FrankRamsey,1927;RonaldCoase,1946andMarcelBoiteaux,1956,tomentiononlyafewpioneers)areassociatedwiththediscoveryofthesepricingmechanisms.

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markets(seeCramton,2017).Theotheristhedesignofratestructuresacrossusers,typesofuse,timeofuse,space,etc.

Inwholesalemarketdesigntwooptionsshowup,withscholarsdividedontheweights.Oneistoremunerateforcapacityanddepartfromtheupcomingmarginalcostpricingvolatility.Theotheristoputmoreemphasisonmoreaccurateandextremescarcitypricing.Arguablyperhaps,somescholarsintheUKandEuropefavorthefirst(HansenandPercebois,2017;Helm,2017,2021)whileintheUSthereismoreoptimismtousemarginalpricesignalstoavoiddistortingsociallyefficientpricing(BorensteinandBushnell,2021mightbeherealthoughwithabalancedview).Viewsontheworkingofwholesalemarketsarenotirrelevantfortariffdesign,despitethefactthatpassthroughorprocuredenergyboughtbyutilitiesmayconformtoamarketequilibriumprice(withexternalitycorrectionsthroughcarbonpricingmechanism).Thepointisthatthemarginalpricesignalbecomesmoreorlessrelevantunderalternativeviewsorpricingparadigms.

Insofarasratedesign,thereisanemergingconsensusonthebasicingredientsorprinciplesthatshouldguideratestructures.First,marginalpricesshouldbesetclosetosocialmarginalcosts(forexample,incorporatingCO2emissioncoststhroughcarbonpricingonfuelsusedingeneration)andreflectscarcityvaluesthroughlocationalpricingandvariationsindemandconditions.Second,tariffschedulesshouldnotdependinexcessonquantityconsumed,i.e.shouldberatheruniformacrossvolumeofenergyconsumed.Third,fixedchargesplayanincreasingroleinfinancingfixed,commonorpolicycosts,i.e.infrastructureservicesshouldnotbechargedtovolumetriccomponents.Fourth,taxesandotherchargesshouldnotexacerbatethebiastowardsvolumetricend-userpricing.Rather,theyshouldcollaborateonfinancingfixedcostsandhelpcompensatingforequityimpactsofreform.

Thepreviousprinciplesleadtotwo-parttariffdesignwithtaxationpossiblymorebiasedtowardsaffectingfixedcharges(accommodatingsubsidiesthere).Acentralaimistoescapefromexcessvolumetricpricingwithrespectofwhatisdesirableforsociallyefficientelectricitypricing.Thereare,however,manyproblemstoovercome.Someareconceptual(whyisincreasingblockpricingnotadvisable?Whatarethelimitstoscarcitypricing?).Otherspertaintohowtoovercomebehavioral,socialorpoliticalconstraints.Afterall:Isitnot“expostoptimal”whatweseeinpractice?Theoryandpracticesuggestitisnot.Wechoosetofocusontwochallenges.Thefirstishowtoshrinkorreducesuboptimalincreasingblockpricingandsecondly,andmoreimportant,howtocoverfixedcostsandthroughwhatmechanisms.Botharecentraltotheprinciplesbehindtariffdesignandwediscussthemseparatelybelow.

2.1Increasingblockpricing

Fromautilitypricingperspective,onecanseeincreasingblockpricingasatariffschedulechosentofollowcertainobjectives,suchasprovidingalow-userfacilitationoraccess,incorporatingequityobjectivesorgivingsignalstopromoteenergyorcapacitysavings.Utilityratedesigncanbeexplainedandtaughtinasortofprogressivefashionwhereonestartswithasimpletwo-parttariff,introduceathirdpartasasocialtarifforlow-userscheme

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(Phlips,1983;Armstrong,CowanandVickers,1990;seealsoNavajas2013fornaturalgas)andproceedstowardsnon-linearoutlaysforendusersthatcanbeshowntobePareto-efficient(Willig,1978),andareconvexoutlays,thatis,ledtodecreasingratherthanincreasingblocks(BrownandSibley,1986).Forincreasingblocks,oneneedstobringadditionalobjectivesofthesortmentionedabove.

Theproblemwithincreasingblocksisinonewayempirical.First,howmanyblockstochoose?(asevidenceshowsthatinpracticetheydonotmatchwellwiththedistributionofusers,seesection5onArgentina).Second,continuousordiscontinuousorunevenformatanditsimplication.Third,thevaluesofmarginalandaveragevaluesacrossblocks.However,thefactisthatincreasingblocksarenotidoneousinstrumentsfortariffdesignfromappliedtheorybutratherapreferredchoseninstrumentbyregulatorstopursue(ordeclaretheyarepursuing)distributiveor“conservationist”(ofenergy)objectives.Evidenceinelectricityconsumptionpatternsshowthatthecorrelationbetweenconsumptionandincome(i.e.EngelCurves)isaffectedbyhouseholdcharacteristicssotheymakeconsumptionacrossincomeorexpendituredecilesmuchuniformthanpreviouslybelieved(Komivesetal,2005)andthusthe“power”oftheseschemestoredistributeislow,aresultthatalsoappliestolowuserschemes(seeNavajas,2009).

EvidencefromtheUS(BorensteinandBushnell,2021)confirmsthatblocksareeitherdecreasingorincreasing,butthesizeormagnitude(ofpricevariationacrossblocks)israthersmall.OtherpapersfortheUShavemeasuredandcriticizedthedistributionalpoweroftheseschemes(BorensteinandDavis,2010andothers).ButforLACwefindmostlyorexclusivelyincreasingblocksandthesizeofpricevariationacrossblocksisnotirrelevant.NavajasandPorto(1990)modeledamultipartoptimaltariffforArgentinaandfoundthattheobservedrangeofpricesacrossblocks(10to1ormore)wereunjustifiedfromadistributionalcharacteristics(ofblocks)approach.Morerecently,Urbiztondo,BarrilandNavajas(2020)foundarangeoffixedchargesofelectricitytariffinEDENORArgentinathatvariedfrommorethan1USdollar(monthly)tomorethan50dollars.ThiscontrastswiththeevidenceinBorensteinandBushnell(2021)thatshowsfixedchargesintheUStodistributeclosetoanaverageofabout10dollars(withawiderrangeonlyemergingafterareformexercisethatintroducessocialmarginalcosts).

Finally,conservationistobjectivesorscarcity(capacity)signalscannotbeproperlyaddressedbyincreasingblocksoftariffoutlayswithfrequenciesofmeteringandbillingthatdonotcorrespondorreflectthosecostsacrosstime.Thisisalsorelatedtotheevidenceanddebateonthebehavioralresponsetonon-lineartariffsortomarginalvs.averagepricesignals(Borenstein2009;Ito2014;ItoandZhang,2020;Lavandeiraetal,2022)andtheproblemoflimitedrationalityorrateliteracy(ReddenandHoch,2006,Shaffer,2020).Complexorill-definedanddiscontinuousincreasingblockpricingisunlikelytoobtainproperordesired(conservationist)householdresponse,moreifaveragepricesmattermostforconsumers.Thisalsoaffects,fairtosay,thedesiredresultsobtainedfromtwo-parttariffreformssuchasthoseweevaluateinsection5below.Thus,thecontextinwhichreformsaredesignedandexanteevaluatedshouldtakethisliteraturemoreseriously.

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2.2.Fixedchargesandfixedcostrecovery

Thenextcriticalissuerelatedtothepreferredprinciplesmentionedbeforeconcernstherecoveryoffixedcosts.Principlesheresuggestthatafixedchargewoulddothejob,anditmaynotbetoolargeinthosecaseswherepricingatsocialmarginalcoststhatarehighduetoexternalities(andthereforewellaboveprivatecosts)createapricecostmarginfromwhichtofinancethosefixedcosts(seeBorensteinandBushnell,2021).However,asremarkedbyBorenstein(2016)economicprinciplesareless(orno)explicitonhowtocoverfixedcosts.Theearlyliteratureonoptimalutilitypricingpointedtoacombinationoffixedchargesandpricecostmargins(wheretwoinstrumentsaregoingtobeweaklydominantoverjustone,e.g.Tirole,1988)orpricecostmarginswerethoughtintermsofRamseypricing.PerezArriagaetal(2017)andBorensteinandBushnell(2021)discussalternatives,includingRamseypricing.TheproblemwithRamseypricingisthatisaso-calledthird-degreediscriminatorydevicethatrequirescategoriesofseparatedconsumers.Withinresidentialusers(wherethemainissuestands),itismoredifficulttofindanobservableandmeasurablevariable.Quantityconsumedorblocks(asshowninNavajasandPorto,1990)donotqualifyforreasonsexplainedbeforeandotherhouseholdcharacteristics(assuggestedinPerezArriagaetal,2017,suchasproperty)leadtoadiscriminatorydevicethatmaybeusefultoconsiderbutitlooksdifficulttoimplementinmanyLACcountries,whereevidenceshowsthatpropertytaxesfaceseriousinformationalconstraintsmostlikelytoariseinelectricitytariffdifferentiation.ThediscussioninBorensteinandBushnell(2021)concerningdifferenttypesofuseofelectricity(e.g.,waterheating,lighting,cooking,airconditioning,etc.)couldcomeinthefuture,assmartmeteringimproves,butitisdifficulttoimaginerightnow,particularlyinLAC.Thisisanissuerelatedtothetopicofclassificationofcustomersintariffdesign.

Thispromotestheideathatrecoveryoffixed,commonandpolicycoststhroughfixedchargesisabetterwayifitisalsosupportedbytaxesthatmoveawayfromvariableorvolumetricdimensionsandhelpcompensateforequityimpacts(Navajas,2018;ContandNavajas,2019).Theneedforcompensationfordistributionalequityimpactshasbeenshowninmoreadvancedexerciseswithnoveldatabasesthatstudytheconsequencesofmovingtotimeofuse(TOU)orrealtimepricing(RTP)(Burgeretal,2020;Cahanaetal,2022).Nevertheless,theideathatfixedcostsrecoverycanbe“movedaway”frompricingtotaxationmaynotbeefficient(giventhecostofraisingpublicfunds)or,moreimportant,maynotbepoliticallyfeasible.Rather,theevidencesuggeststheopposite,withsocialissuesnotwellmanagedbypublicfinancesendingupimpactingonelectricitypricing.AffordabilityproblemsinLACarethebestexampleofthis.Weexplorethepolicy-optionimplicationsofthisattheendofthepaper.

3.Definitionandcorrespondenceoftariffelementsandcostcategories

Wehaveseenthatsolideconomicprinciplesareessentialtoguidetheanalyticsandmeasurementofelectricitytariffandprovidearichsetofissuesforpolicyguideline;LACneedstomoveinthisdirection.However,nationalregulatoryauthoritiesorministerial

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officesinchargeoftariffinformationandanalysis(seeTableinAppendixA)arelessorientedtowardsefficient(social)pricingdesignissuesthanacademiceconomistsandusuallydemandorientationonfarpracticalissuesoftariffdefinitionandclassification.Costrecoverythroughregulatoryproceduresandaccountingratherthan(social)costreflectivityoftariffschemesareamongthoseissues.Besides,thedefinitionandinformationcomponentsoftariffelementsacrossnationalenvironmentsreflectdifferent,heterogeneousconceptualandinformative(transparent)settingsthatrequireanefforttomakeuniformcomparisons.

ThesearchforanunderstandingandforapolicydialogueapproachtoelectricitytariffsinLACneedstoproceedbymeasuringwhatweobservetodayintheregion.Thesolemeasurementofelectricitytariffsposesaquestiononwhatwereallyobserveandwhatinformationcountriesofferintermsofthemethodologyoftariffsettingandreporting.Whilethiscallsforanefforttomakehomogeneouscomparisonsoftariffcomponents(e.g.fixedvsvariablecharges),thereisstilltheproblemofwhatmethodologyisbehindwhatweobserveandwhatnationalauthoritiesinformanddonotinform.Thus,whileadiscussiononmethodologicalissuestosupportameasurementprojectofelectricitytariffinLACisausefulcontribution,thereisapreviousandobviouspoint.Thisistorecommendacoordinationacrosscountriesoftheinformationprovidedineachcaseandaminimumsetofrequisitesintermsofwhatsuchinformationshouldreflectorreport.ThisissimilartowhattheIMFrequiresforfiscalandmonetarystatistics.

Giventhis,thequestionremains,whithercoordination?i.e.,behindwhichminimumstandards?Thesoleobservationofelectricitytariffsbegsthequestionofhowmuchrevenueisraisedbywhichcomponent(seeFigure1insection5below)andreflectingwhichcosts.Thatis,revenuecollec