A European energy regulator asked Brattle experts to assist with the design of a regulatory framework for the newly-introduced activity of building and operating offshore transmission cables (to connect off-shore wind generators to the transmission grid). We were responsible for recommending incentive arrangements that would encourage the cable operator to ensure that the cable would be reliable and delivered on time. The recommendations were developed by reviewing limited experience with such incentives in other jurisdictions and industries, and through illustrative examples of the financial impact of incentives on a hypothetical cable operator. The key issue was designing a sufficiently powerful incentive that would not threaten to bankrupt the operator.

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