Econometrics techniques, carefully applied, can shed new light on the factors driving economic developments
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Energy continues to be a hot topic whether at the level of national or international policy, regulation of particular sectors, company investment decisions or impact on consumers.  Many energy decisions are now closely linked to the assessment of their impacts on the environment.

Types of Study

Clear economic analysis is an essential tool for understanding developments in the energy sector.  At a policy level, economic principles are crucial to the assessment of future energy price movements, investment requirements, environmental impact and the security of supply.  For regulators and regulated firms, economics can guide the setting of efficiency targets and the design of optimal incentive mechanisms.  The evolution of industry structures, competition, and prices paid by electricity and gas customers is another area where economics provide important insights.

We have carried out assessments for sectoral regulators, in the UK and elsewhere, of the scope for productivity improvement in gas and electricity network operations; and have advised companies on specific aspects of regulatory changes.  At European level we have prepared an impact assessment on State aid to the coal sector, and a review of the impact of changes to the regime for energy taxation.

We have also prepared an impact assessment of proposed changes to the Energy Labelling Directive. Increases in energy prices are of concern to both retail and industrial customers.  We have worked closely with consumer groups to assess the development of competition in the UK market, and to identify shortcomings which need to be addressed.

There is growing demand for appraisal of the environmental aspect of energy policies.  We have developed detailed models for carrying out this type of work.  These include models to assess the costs and benefits of requiring new homes and non-domestic buildings to be built to a zero-carbon standard.

Our Clients

Our clients are both public sector policy-making organisations, and private sector companies and associations.

They have included the European Commission, Ofgem, The Department for Communities and Local Government, National Grid, Scottish Power, energywatch, DTe (now NMA, Netherlands) and Kahramaa (Qatar).

Our Experts

Our in-house team in this field includes:  Stephen Topping and Jonathan Green.

Primary contact: Stephen Topping.