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Monopoly Money: How consumers overpaid by billions

30 May 2019

The full report can be found here [ 0.8 mb].

Networks are the companies that provide the pipes and wires that connect energy, water, broadband and telephone lines to our homes. Running these pipes and wires cost a lot of money. Networks must attract investors to pay for things like building new pylons.

Funding for this investment is raised through borrowing money (debt) and selling shares in the company (equity). In exchange for providing this finance, investors expect a rate of return (profit).

Regulators over-estimated the cost of borrowing and investment. The costs of borrowing money and return needed for investment have been lower than they thought they would be.

We re-ran the figures based on the actual cost of these essential services rather than regulators' forecasts. We found people have been overcharged the difference of £24.1 billion.

Companies should return this money back to their customers, through a rebate on their bills, by the end of this year. If companies fail to act, government should step in.