News and publications
December 2011
Risk free experiments for regulators: Ain’t Misbehavin’
Indepen recently published an article in Utility Week demonstrating that regulators must base their incentive structure on how companies actually behave, not how economists expect them to. This demands increased engagement from both regulators and the regulated. Preliminary work in this area has demonstrated the huge potential for improvements in understanding in this area.
September 2011
Risk, regulation and behavioural modelling
Following our report “Risk, regulation and behavioural modelling of water company performance”, this summary paper sets out the theory used, and its wider applications and benefits throughout the regulated industries.
June 2011
Risk, regulation and behavioural modelling of water company performance
Indepen has published the initial results of research it has conducted together with Volterra into behavioural modelling of water company performance.
The report describes a behavioural model that acknowledges the varying constraints and motivations present in the industry, some of which diverge from the assumptions of standard economics to which regulators and companies tend to have regard. The model has enhanced our understanding of the outcomes of regulation and shown that feasible differences in company and customer preferences and behaviour, combined with a one size fits all approach to regulation can have potentially unintended consequences. This report represents work-in-progress but the results so far suggest this is a promising route to exploring regulatory relationships and structures, not just in the water industry. The report was presented to a seminar at Ofwat in June 2011.
Full report
Presentation to Ofwat
October 2010
Refilling the bath: a discussion paper on water policy and regulation
Following our report “Changing the bathwater”, this report continues our work with the Water and Sewerage Companies, this time exploring how policy and regulatory change can impact on financeability.
May 2010
Changing the bathwater – a discussion paper on water policy
This paper formed part of a project to present the desirability of changes in policy towards water in England and discuss how to take these forward. Indepen worked closely with a group of sponsoring Water and Sewerage Companies, and conducted a review of the evolution of policy and the sector since privatisation.