Price Controls & Regulation
Europe Economics has well-developed expertise in advising on price controls
For example, we can advise on:
Competition assessment
The design of price controls
Advising on all aspects of the design of price controls, including the appropriate scope, structure and duration.
Incentive schemes
Analysing whether firms have significant market power, and hence whether there are grounds for applying price regulation.
Cost-benefit analysis of capital projects
Assisting with the cost-benefit analysis of capital projects being put forward for inclusion within price limits (or with the review of cost-benefit analysis produced by other parties).
Efficiency benchmarking
Applying a wide range of quantitative techniques to benchmark costs in order to assess what cost levels are efficient.
Cost of capital and financeability
Advising on the appropriate rate of return for price regulated firms, as well as on the assessment of financeability. We can also advise on the retail margins that should be allowed for asset-light businesses.
Modelling risks and rewards
Modelling the range of potential outcomes for the return on regulatory equity (e.g. using Monte Carlo simulation modelling).
Mechanisms to deal with uncertainty
Advising on risk mitigation mechanisms.
Financial modelling
Constructing, extending or reviewing the financial models required to calculate price limits and test financeability.
Impact assessment
Carrying out impact assessments of price control proposals.
Introduction of competition
Advising on the introduction of competition into regulated sectors, including access pricing arrangements and reforms to price regulation to promote competition.
Tariffs
Assisting in the design of tariff structures, including the building or review of tariff models.
Europe Economics has well-developed expertise in advising on price controls
For example, we can advise on:
Key Contacts
Please feel free to reach out to our experts if you have any questions.
Price Controls & Regulation Publications
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