SKILLS & EXPERTISE

ECONOMIC REGULATION

Economic analysis is a prerequisite for effective regulation of public services and infrastructure industries. Effective regulation requires a thorough understanding of the incentive effects different approaches produce. Where intervention is justified, it is vital that careful attention is paid to the detailed cost, organisational structure, and competitive characteristics of the industry in question.

As competition and regulation complement each other, economic advice can also help companies and regulators assess the extent to which consumers' interests are best protected by competition, and define the proper boundaries of regulation.

Europe Economics has well-developed expertise in advising on price controls. The firm has in-depth understanding of the incentive effects of different forms of price regulation and the building blocks used to set price controls. Europe Economics staff can advise on demand projections, top-down and bottom-up modelling of efficient cost levels, asset valuation, depreciation, cost of capital, financeability issues and regulatory mechanisms for addressing uncertainty and quality of service. We are able to carry out financial modelling for regulatory analysis and to advise on regulatory accounting.

Europe Economics can advise on a range of other regulatory issues, including tariff structures, sector liberalisation and the introduction of competition, licensing regimes, trading and settlement arrangements, appeals mechanisms, and economic aspects of social and environmental regulation.

Europe Economics has advised almost all the UK economic regulators and several regulated companies on aspects of economic regulation, and has also advised the EC, and national regulatory authorities in other EU Member states including Ireland, Italy, Spain, Portugal, Denmark, and Finland.