Comparing of Price Determination in Iranian Electricity Industry in BOT Models

Utilizing modern financing methods have been focused by governments either for low public budgets or for higher cost productivity of private sector. The financing method of Build-Operate-Transfer (BOT) is one of the most applicable methods for participation of private and public sectors. This paper examines two price determination methods in Iranian electric industry and compares them. Two pricing methods are compared in this paper: 1) two parts pricing (i.e. one part of price is extended and one part of price is non-extended during the operation period of the project) and 2) one part pricing (i.e. totally extended pricing during the operation period of the project). The results show that applying either model depends on policies of government against deregulation of prices.