ComCom sees lower risk for regulated fibre

In this edition Chorus, Enable, Tuatahi push back on fibre review One New Zealand updates Infratil investors Fibre companies challenge lower risk assessmentIn its preliminary analysis for the 2027 Fibre Input Methodologies review, the Commerce Commission says it has found a marked reduction in the systematic risk of fibre businesses.This is important because the regulator uses the risk assessment to calculate the weighted average cost of capital (WACC) for regulated fibre companies.The WACC, in turn, helps determine the return those companies are allowed to earn on their regulated assets, with implications for both customer prices and investment incentives.Last week’s newsletter looked at another part of the same calculation. There Chorus and other infrastructure companies challenged the Commission’s approach to measuring the market risk premium. This week the focus is on a different input: how risky the fibre businesses themselves are.Three of New Zealand’s four fibre companies made…