This MCC paper explains how Abu Dhabi has regulated operating expenditure over time and what the evolution says about efficiency incentives, evidence standards, and regulatory maturity. Explore how benchmarking, conditional mechanisms, and forecasting discipline shape allowances and utility behaviour.
The paper traces the development of Opex setting in Abu Dhabi’s utility price controls, highlighting the shift from simpler historical baselines toward more structured, benchmarked approaches. It discusses how hybrid “top-down” and “bottom-up” methods, yardstick competition concepts, and conditional allowances influence the gap between company forecasts and allowed expenditure. The note also flags real-world uncertainties like inflation shocks and supply chain pressures and how adaptive mechanisms can balance consumer protection with operational realities.
This paper has been published on following other platforms
I was delighted that MCC's work was completed on time, and within budget, helping us deliver important changes and improvements, to the benefit of our stakeholders. MCC's report is published on the CCC website.
I am delighted to recommend MCC Economics. Specifically, I worked closely with PJ, who helped us with our Nuclear and CCUS projects. PJ helped us develop new policies and answer questions from our stakeholders. His support helped us deliver important changes and improvements, to the benefit of our stakeholders.
MCC Economics has helped us better understand the most important issues for our stakeholders, including: charges, shareholder returns, debt payments and inflation impacts.
I am delighted to recommend PJ and his team at MCC Economics. We've been working together on National Policy Statements to help meet net zero targets for 2030 and 2050. We initially appointed MCC Economics to support us on offshore wind consultation analysis and have recently reappointed MCC Economics to undertake a larger consultation analysis role across all sectors, including hydrogen, CCUS and networks. I can confirm that PJ and his team have shown excellent spreadsheet skills, alongside very good project management, planning and analysis skills, helping us deliver important changes, and continuous improvements, to the benefit of our stakeholders.
I am delighted to recommend PJ and his team from MCC Economics. They helped us with our price controls for Heathrow airport and for NATS (En Route) plc (the air traffic services provider). Specifically, the MCC team helped us deliver important changes and improvements to our financial models and supporting policy documents, to the benefit of our stakeholders.
I am delighted to confirm that I worked with PJ on a retail project in 2015. The project helped stakeholders understand electricity costs and charges. Specifically, the project helped us explain to stakeholders, internally and externally, why electricity charges differed across the regions (GB, NI & Ireland). PJ was a key member on the project team, which helped deliver changes and improvements in the understanding of energy retail.
Evidence-based analysis for transparent, defensible, and effective decision-making.
© All rights reserved – MCC Economics 2024.