RIIO-ED2 framework decision

This note summarises the key aspects of the RIIO-ED2 framework decision; outlines the key strategic issues facing the sector that Ofgem is considering; and provides a commentary on what this means for companies, based on Oxera’s initial review of the document.

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Regulation and policy in Italy: don’t throw away the baby with the bath water!

The Italian water sector is undergoing a period of significant change. The sector does not require radical intervention in its ownership structure to improve investment levels and quality standards, but rather a package of measures to improve the management model and enhance independent regulation. How can tariff regulation be extended nationwide, and how can existing industry fragmentation be overcome?

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Digital platform regulation: What are the proposals across Europe?

Calls to ‘do something’ about tech giants are getting louder. Some suggest that breaking them up is the best way to go, but such strong intervention is absent from the most developed regulatory proposals seen so far. Taking into account recent prominent reports from (or for) the European Commission and several national competition authorities, what are the main proposals on the table, and are they plausible?

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Conduct risk management—high five?

Financial services providers around Europe are subject to clear expectations from regulators regarding conduct risk (or ‘the risk of misconduct’ that can cause poor consumer outcomes or undermine market stability or competition). What are these expectations, and how can providers meet them? In our experience, managing conduct risk requires a new toolkit based on behavioural economics, business model analysis, machine learning, competition economics, and good governance.

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All for broadband and broadband for all

In the run-up to last week’s UK General Election, the main political parties supplemented headline-grabbing policy announcements around Brexit policies and the NHS with outlines of their plans for supporting investment in key national infrastructure. Among the announcements were those in support of ensuring that all homes and businesses should have access to very high capacity broadband. With the Conservative Party now in power and promising to deliver gigabit-capable networks for all by 2025, we ask how can this be achieved?

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Ofwat’s PR19 Final Determinations

Ofwat published its final determinations (FDs) for the England and Wales water sector at 07.00 on 16 December 2019. There are many documents and a lot of detail that the industry will need to pore over in order to understand the implications. Here we explore the three main contentious issues in the sector: finance, cost efficiency and outcome delivery incentives (ODIs). We take an initial look at what has changed since the draft determinations (DDs), published earlier in the year.

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The cost of equity for RIIO-2 – Q4 2019 update

Energy networks have recently submitted their final business plans to Ofgem in advance of the forthcoming RIIO price controls for transmission and gas distribution. Oxera prepared updated estimates of the cost of equity to inform the companies’ business plans. The report reflects new evidence from capital markets since the Oxera report from Q1 2018, as

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RIIO-ED2 framework decision

This note summarises the key aspects of the RIIO-ED2 framework decision; outlines the key strategic issues facing the sector that Ofgem is considering; and provides a commentary on what this means for companies, based on Oxera’s initial review of the document.

Read More


Regulation and policy in Italy: don’t throw away the baby with the bath water!

The Italian water sector is undergoing a period of significant change. The sector does not require radical intervention in its ownership structure to improve investment levels and quality standards, but rather a package of measures to improve the management model and enhance independent regulation. How can tariff regulation be extended nationwide, and how can existing industry fragmentation be overcome?

Read More


Digital platform regulation: What are the proposals across Europe?

Calls to ‘do something’ about tech giants are getting louder. Some suggest that breaking them up is the best way to go, but such strong intervention is absent from the most developed regulatory proposals seen so far. Taking into account recent prominent reports from (or for) the European Commission and several national competition authorities, what are the main proposals on the table, and are they plausible?

Read More


Conduct risk management—high five?

Financial services providers around Europe are subject to clear expectations from regulators regarding conduct risk (or ‘the risk of misconduct’ that can cause poor consumer outcomes or undermine market stability or competition). What are these expectations, and how can providers meet them? In our experience, managing conduct risk requires a new toolkit based on behavioural economics, business model analysis, machine learning, competition economics, and good governance.

Read More


All for broadband and broadband for all

In the run-up to last week’s UK General Election, the main political parties supplemented headline-grabbing policy announcements around Brexit policies and the NHS with outlines of their plans for supporting investment in key national infrastructure. Among the announcements were those in support of ensuring that all homes and businesses should have access to very high capacity broadband. With the Conservative Party now in power and promising to deliver gigabit-capable networks for all by 2025, we ask how can this be achieved?

Read More


Ofwat’s PR19 Final Determinations

Ofwat published its final determinations (FDs) for the England and Wales water sector at 07.00 on 16 December 2019. There are many documents and a lot of detail that the industry will need to pore over in order to understand the implications. Here we explore the three main contentious issues in the sector: finance, cost efficiency and outcome delivery incentives (ODIs). We take an initial look at what has changed since the draft determinations (DDs), published earlier in the year.

Read More


The cost of equity for RIIO-2 – Q4 2019 update

Energy networks have recently submitted their final business plans to Ofgem in advance of the forthcoming RIIO price controls for transmission and gas distribution. Oxera prepared updated estimates of the cost of equity to inform the companies’ business plans. The report reflects new evidence from capital markets since the Oxera report from Q1 2018, as

Read More


How does social media shape purposeful business?

Society is playing a growing role in shaping the way that businesses operate. Reflecting this, have become platforms to highlight good and bad business practice and help people coordinate responses. To what extent does this pressure influence core business operations? —and therefore the future of business? Tim Hogg, a behavioural economist at Oxera, takes a look at the role of social media in the context of thinking Beyond the Bottom Line.

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Investment promises from politicians—should we believe them?

As the UK general election approaches, voters are being seduced by promises from all the parties about how much they will invest in improving the nation’s infrastructure over the next Parliament. What should we make of these promises? This question is not just about political credibility (or even honesty); it has a hard economic edge. The injection of a slew of new major and minor projects would have implications for the quality of public services, employment, inflation, taxation and government debt. It is worth asking ourselves how much of this spending will actually happen—and when.

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What are firms for? Redefining corporate purpose

What should be the purpose of a firm? To maximise profits or shareholder value, or to pursue wider societal objectives? Professor Julian Franks of London Business School, and Oxera Partner, discusses the roles of trust and implicit contracts in redefining corporate purpose. He looks at changes that may be required in regulated utilities, with a focus on water

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