I would like to take the opportunity to welcome you personally to the Training on the Role and Assessment of Capital Expenditure in Energy Regulation. The inclusion of capital costs in allowed revenues recognizes the owners’ investment in the regulated company. Due to the capital-intensive nature of the energy infrastructure business, failure to allow a provision for adequate capital costs can pose a risk, discourage investment, and lead to reductions in quality levels and security of supply.

On the other hand, including inefficient investment costs in allowed revenues leads to high energy prices, distorted price signals, and constraints on the effective performance of the market.

Upon completion of the course, participants will understand the role and assessment of capital expenditure in energy regulation, along with the methods used to support decision-making. Moreover, they will explore the investment appraisal techniques and their practical use in regulatory analysis. Furthermore, participants will examine the drivers of low demand that lead to declining asset utilization and potential asset stranding, as well as regulatory policies to address these issues. The conceptual part of the training will be supported by comprehensive practical exercises and examples from international experience throughout the course.

I look forward to starting the course with you with an introductory session.

Mr. Konstantin Petrov, Course Director, Managing Consultant DNV Energy Systems, Germany