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Media centre
UK economic regulators* (including the Office of Fair Trading) have today released a study on the cost of capital. The regulators jointly commissioned the report on certain aspects of the cost of capital for regulated utilities in the UK. This study provides interesting insights into the cost of capital in the regulatory context. This is an independent study and does not necessarily reflect the views of the regulators. The study has been carried out by Stephen Wright (Birkbeck College), Robin Mason (University of Southampton and Centre for Economic Policy Research, CEPR) and David Miles (Imperial College and CEPR) on behalf of Smithers & Co Ltd. The objectives of the study were to: · establish, through independent research, the best current approach to the cost of capital for regulated utilities; and · provide an independent view of the extent to which consistency in the approach to the cost of capital can be achieved by regulators (including the OFT) together with fully argued reasons as to why there may be differences. The regulators welcome the report as a useful contribution to the debate in the UK and look forward to comments from interested parties, as this is an important issue for on-going regulatory and competition policy and practice in the UK. If you would like to comment on the paper, please contact Keith Mason, at keith.mason@ofwat.gsi.gov.uk Note to Editors: 1. The Director General of Water Services is the economic regulator of the water and sewerage industries in England and Wales. He exercises his powers in a way that he judges will allow them to carry out their functions properly, and finance them. Customers' interests are represented by WaterVoice. 2. Copies of the report will be available from the Ofwat website on www.ofwat.gov.uk or from the Ofwat library on 0121 625 1373. 3. *The Office of Water Services (OFWAT), Civil Aviation Authority, Office of Gas and Electricity Markets (Ofgem), Office of Telecommunications (Oftel), Office of the Rail Regulator (ORR), Office of Fair Trading (OFT) and Office for the Regulation of Electricity and Gas (OFREG). MEDIA ENQUIRIES TO OFWAT PRESS OFFICE ON: 0121 625 1416/1496/1442 Out of hours enquiries to pager: 08700 555 500 water 503/509. Ofwat publications and press notices can be found on Ofwat's website at: www.ofwat.gov.uk  | ||||||
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