LATEST NEWS
Northern Ireland Water – PC21 final determination
Last week, the Utility Regulator (UR) published its Final Determination for Northern Ireland Water’s (NIW) latest price control (PC21). Amongst other things, the UR found that NIW’s relative efficiency had improved in recent years and so set it a smaller efficiency challenge than it had in previous price controls. Economic Insight advised NIW throughout the price control process. Our work involved both engaging with the UR and its consultants on all issues relating to the measurement of relative efficiency and also developing suitable econometric models for benchmarking NIW’s costs.
Plausible defence? CAT’s ruling on mitigation by cost reduction
Last week, the Competition Appeal Tribunal (CAT) dismissed DAF’s application to run a “mitigation by costs reduction” defence in the context of Royal Mail’s and BT’s damages claims against it. Royal Mail and BT both claim that they were charged too much for the trucks they purchased from DAF between 1997 and 2011 as a consequence of the trucks cartel. DAF sought to argue that Royal Mail and BT may have mitigated any overcharge by paying less for other inputs. Amongst other things, the CAT concluded that DAF did not have “a sufficiently arguable case – with realistic prospects of success”. Economic Insight is advising Royal Mail and BT in relation to their claims and provided evidence to the CAT on this issue.
The CAT’s ruling on mitigation can be found here: https://lnkd.in/dvkGnNX
Details of the European Commission’s decision on the trucks cartel can be found here: https://lnkd.in/dPt5vXE
Effect of COVID-19 on ODIs – South East Water
Economic Insight is supporting South East Water in relation to the effect of Covid-19 on one of its outcome delivery incentives (ODIs).
Sponsorship – Westminster Business Forum
We are delighted to announce that Economic Insight will be sponsoring the upcoming Westminster Business Forum.
CMC for the on-going trucks cartel litigation
A case management conference (CMC) is being held on 5th and 6th May in relation to the on-going trucks cartel litigation. Economic Insight are the economic advisors to the Dawsongroup claimants, who are being heard in this case.
RIIO-ED2 business plan – SP Energy Networks
Economic Insight has been commissioned by SP Energy Networks to help develop Output Delivery Incentives for its RIIO-ED2 business plan. As a key part of the RIIO framework, these mechanisms will incentivise companies to deliver what really matters for customers.
Drivers of flooding incidents – Severn Trent Water
Economic Insight has been commissioned by Severn Trent Water to carry out a research project to better understand the drivers of flooding incidents. Economic Insight will complement Severn Trent Water’s own internal bottom-up hydraulic modelling with a top-down econometric analysis, modelling flooding incidents against a number of variables including rainfall, river levels, and the placement of assets both within and outside of management control.
The economics of mitigation by cost reduction
Two of our consultants, Sarah Barker and Marie Theres Kraihammer, have written an article on the economics of mitigation by means of cost reduction. They find that analysis that explores cost mitigation may point to misleading conclusions if it is not based on economic theory. Therefore, competition authorities should give careful consideration to the economics underpinning this form of mitigation. Read Article
Impact of COVID-19 on Heathrow
Our regulation experts, led by director Sam Williams, recently assisted Heathrow Airport Limited (HAL) in the Civil Aviation Authority’s (CAA’s) consideration of the strategic response to the impact of COVID-19 on the regulated airport.