Scoop has an Ethical Paywall
Work smarter with a Pro licence Learn More

Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Consultation on cost of capital for telecommunication price

Commission consults on cost of capital for telecommunications price reviews


The Commerce Commission is seeking submissions on its proposed approach to setting the rate of return on capital for the unbundled copper local loop (UCLL) network and the unbundled bitstream access (UBA) service.

The allowed rate of return on capital is also known as the ‘weighted average cost of capital’ (WACC).

“To set these prices we are estimating the costs of the UCLL network and the UBA equipment,” Telecommunications Commissioner Dr Stephen Gale said. “The prices that will be allowed will also include the WACC.”

The Commission proposes to use the same general approach to the cost of capital that was developed for the regulation of energy networks and airports. This approach was incorporated in the 2010 cost of capital input methodologies (IMs) that were upheld in appeals to the High Court last year.

The Commission will be seeking independent expert advice to tailor the general approach to allow for the specific risks and capital structure of a telecommunications network business.

The Commission invites submissions, supported by evidence, on the proposed approach. Interested parties will have a further opportunity to submit on WACC, including the specific parameters the Commission adopts, in response to the draft UCLL and UBA price review determinations.

The consultation paper can be viewed at: www.comcom.govt.nz/uba-final-pricing-principle-price-review orwww.comcom.govt.nz/ucll-final-pricing-principle

Submissions are due by 5pm Friday 28 March 2014. Please email submissions to telco@comcom.govt.nz.

Ends

Advertisement - scroll to continue reading

Are you getting our free newsletter?

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.

© Scoop Media

Advertisement - scroll to continue reading
 
 
 
Business Headlines | Sci-Tech Headlines

 
GenPro: General Practices Begin Issuing Clause 14 Notices

GenPro has been copied into a rising number of Clause 14 notices issued since the NZNO lodged its Primary Practice Pay Equity Claim against General Practice employers in December 2023.More

SPADA: Screen Industry Unites For Streaming Platform Regulation & Intellectual Property Protections

In an unprecedented international collaboration, representatives of screen producing organisations from around the world have released a joint statement.More

 
 
 
 
 
 
 
 
 
 
 
 

Join Our Free Newsletter

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.