RTE: Financing electricity transmission investments in a regulated environment
Publication Number of pages8
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AbstractLeading up to 2013, Réseau de Transport d’Électricité (RTE), a French transmission operator (TSO), was the largest TSO in Europe’s electricity network. Like all European TSOs, RTE was subject to regulatory regimes. At the end of 2013, RTE was operating under a revenue cap, which required that it seek the regulator’s approval before making capital investments. The company was poised to undertake an ambitious investment program in 2014 to replace aging assets. However, the potential for regulatory changes, the need for the regulator’s approval, and the long depreciation life of the assets made planning difficult. RTE needed to develop a financial planning model that would help it decide whether to make the investment and how to prepare for possible regulatory uncertainties.
Knowledge Domain/IndustryAccounting & Finance
Special Industries : Energy