In government regulation of public utilities, the validity of Baron-Myerson mechanism is queried, due to the implicit output attributed by information asymmetry. This paper builds up a new model based on the basic structure of Baron-Myerson model, and analyzes the impacts on the mechanism validity implicit given by implicit output. Furthermore, we discuss the utility enterprise behaviors quoting the cost parameter, under the circumstances that when government estimate demand is greater than or smaller than true demand. Moreover, the paper explains the current phenomenon of government regulation failure by the analysis results and puts forward the relevant suggestions.