Chancellor of the Exchequer Philip Hammond has announced that he has commissioned the National Infrastructure Commission to carry out an independent review of the UK utilities regulators.

The Treasury said the UK has a world-class regulatory system which protects the interests of consumers. However, it needs to be “fit to respond to the challenges of the future to remain cutting-edge.”

The NIC study of the telecoms, energy and water regulators is intended to ensure they have the ability to “encourage investment, promote competition and innovation and meet the needs of consumers in the 21st-century.”

The review will examine regulation of the UK’s energy, telecoms and water industries to ensure the necessary levels of investment and innovation whilst “these critical services are kept affordable for everyone.”

The regulation study is expected to examine:

• What future changes will affect the regulated sectors: The National Infrastructure Assessment identified the UK’s infrastructure needs to 2050. The study will aim to set out the key drivers of change over the coming decades
• Competition and innovation: whether the regulatory model encourages where appropriate, sufficient competition and innovation to support efficient delivery of infrastructure
• Regulatory consistency: How regulators work together and collaborate on cross-cutting challenges and significant infrastructure projects
• How Government and regulators work together: How Government can effectively deliver its objectives in these regulated sectors, while continuing to safeguard the independence of the regulators

The regulation study will also consider the full range of potential implications of any changes, paying particular attention to the need to keep bills affordable and to ensure vulnerable customers are protected.

Chairman of the National Infrastructure Commission Sir John Armitt said:

“Whether it’s turning on a light, taking a phone call or even making a cup of tea, we are dependent on our energy, telecoms and water industries to go about our daily lives.

“The regulators are vital in ensuring we as consumers are treated fairly. But if the UK is to be a world leader in the latest technologies, we need a system of regulation that allows companies to be innovative, without being penalised for it.

“Our new study will examine how to strike the right balance and how companies and regulators alike can be ready to adapt to changes in future, while at the same time keeping bills affordable and protecting vulnerable customers.”

The National Infrastructure Commission will report on the Regulation study in Spring 2019. It will build upon initial work undertaken by the Commission in this area to inform and take forward the conclusions of the National Infrastructure Assessment.

The study follows publication of the UK’s first-ever National Infrastructure Assessment, which covered a range of sectors including energy, telecoms and water.