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Water

We worked on a variety of practices and issues, for a plethora of clients, both public and private, national and overseas.

Europe Economics has extensive experience in the water sector

Over our years of experience, we have worked on cost of capital matters, real pricing effects, outcomes incentives, cost assessment, econometric analysis, risk sharing mechanisms, and several training courses. Below we provide a short list of most salient water-related projects we have worked on:

Delivery Partner

For Ofwat, we have recently worked as the Delivery Partner along with PwC and Mott MacDonald for PR19. This involved support on cost assessment, cost of capital, incentive regulation, real price effects, frontier shift and quality assurance.

Ofwat

Our personnel have been seconded multiple times to Ofwat, and we have carried out various discrete studies analysing the water sector from different perspectives. Some of these have involved cost …

Our personnel have been seconded multiple times to Ofwat, and we have carried out various discrete studies analysing the water sector from different perspectives. Some of these have involved cost assessment support for RAPID gate two assessment; advising on important aspects of Ofwat’s approach to the cost of equity for PR24 and; assisting with the investigation of the potential for improving Ofwats’s methodology to mergers’ assessment.

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Ofwat

Our personnel have been seconded multiple times to Ofwat, and we have carried out various discrete studies analysing the water sector from different perspectives. Some of these have involved cost …

Read more...

B-MeX

We have been commissioned by Ofwat to explore the concept and feasibility of a business customer measure of experience (B-MeX).

Third-Party Intermediaries

Europe Economic has been commissioned to study the role of Third-Party Intermediaries (TPIs) in the retail business part of the water sector.

Incentives of equity

We have also been commissioned to analyse the incentives of equity on the delivery of the functions of water and wastewater companies.

Thames Water

For Thames Water, we advised on the appropriate cost of capital to be applied under Ofwat’s PR14 price review, and advice on risk-sharing mechanisms in light of Ofwat’s total expenditure cost assessment and total expenditure menus.

Commission for Regulation of Utilities

For the Commission for Regulation of Utilities in Ireland, we advised on the Weighted Average Cost of Capital (WACC) for Irish Water in the context of RC3 price control.

Irish Water

We provided a workshop on non-domestic water tariffs to Irish Water, the water regulator of the Republic of Ireland. The course covered different options for the allocation of costs between customer groups and for the structure of tariffs.

Get in touch with us

Europe Economics has extensive experience in the water sector

Over our years of experience, we have worked on cost of capital matters, real pricing effects, outcomes incentives, cost assessment, econometric analysis, risk sharing mechanisms, and several training courses. Below we provide a short list of most salient water-related projects we have worked on:

Get in touch with us

Key Contacts

Please feel free to reach out to our experts if you have any questions.

Dr Andrew Lilico

Executive Director and Principal

Stephen Topping

Principal

Dr John Spicer

Director and Managing Consultant

Deborah Drury

Managing Consultant

Dive into our practice areas

Price Controls & Regulation
Effective regulation of public services and infrastructure industries.
Competition Policy & Litigation Support

We specialise in providing research input and expert analysis to assist our clients in legal cases

Cost of Capital

We have consistently delivered high-quality results, enabling our clients to make informed decisions

Impact Assessment, CBA & Policy Evaluation

Economics plays an important role in understanding the implications of new government policies, regulatory requirements

Economics Training Courses

We provide economics training courses to regulators, companies, consumer organisations and government departments.

Macroeconomic & Political Analysis

Specialises in providing extensive macroeconomic and political analysis services, offering valuable insights to our clients.

Econometrics, Modelling & Quantitative Analysis

Econometrics involves estimating mathematical models to represent and describe real-world economic relations.

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European Commission, DG CLIMA

We have conducted several studies for DG CLIMA relating to the European Union’s emissions trading system.   For example, we conducted a study looking at the impact of changes in trading activity on the price formation processes in the European carbon market, the access to the market for retail investors, which included also the access via exchange traded funds (ETFs), the hedging strategies of EU emissions trading system (ETS) compliance entities, and the role played by derivatives and financial entities in the EU ETS.

Danish Energy Regulator (Energistyrelsen)

We looked at how a benchmarking model used to help set price controls by the Energistyrelsen on DSOs might affect the Green Transition.  We looked at the challenges facing DSOs in the Green Transition and what behaviours should be incentivised.  We then looked at how the benchmarking model and wider regulatory framework might affect those incentives.  This included developing a number of worked examples to consider how the benchmarking model might affect incentives to invest in network expansion, faster connections or flexibility solutions. 

Zero Waste Scotland

Europe Economics was engaged by Zero Waste Scotland (ZWS) to estimate how potential efficiency savings in water and energy are likely to be distributed across firms of different sizes and ownership structures in Scotland. The aim was to inform ZWS policy of where to target resource saving initiatives; in particular whether potential savings were sufficiently concentrated among SMEs to warrant specific effort among these.

We was also engaged by ZWS to estimate the costs and benefits of proposed market restrictions on specific single-use plastic products in Scotland and to analyse the impacts of the restrictions on competition, consumers and Scottish firms.

Citizens Advice UK

We were commissioned by Citizens Advice UK to investigate the mechanisms that could be used to limit or share the financial risk for energy bill payers in the context of highly anticipatory energy infrastructure investments in GB.

We developed a compendium of risk-allocation tools and, for each, we analysed: the suitability of the mechanism for different types of investments and projects; the extent (and the type) of risk allocated to consumers; the relative advantages and disadvantages of the tool; and how they affect the cost of capital. Each tool also included a case study of the tool being applied in practice.

Ofwat

Our personnel have been seconded multiple times to Ofwat, and we have carried out various discrete studies analysing the water sector from different perspectives. Some of these have involved cost assessment support for RAPID gate two assessment; advising on important aspects of Ofwat’s approach to the cost of equity for PR24 and; assisting with the investigation of the potential for improving Ofwats’s methodology to mergers’ assessment.