When less is more: reducing regulatory judgement
The need for judgement is a key feature of many regulatory regimes; if a significant amount is required, this can increase regulatory risk, and therefore also the financing costs to the companies concerned. We examine how regulatory judgement can be reduced in one aspect of RPI – X regulation—the efficiency assessment—and investigate how better decisions can be made with less information, reducing both the regulatory burden and the requirement for maintaining independent comparators in an industry.
