Van Dijk MC have an experience of over 15 years in developing and implementing cost modelling approaches for public authorities as well as private and regulated companies.

Depending on the exact needs of our customers, tailor-made solutions are developed, reflecting country, sector and/or company specificities.

Wholesale and Retail Pricing
 

A thorough understanding of cost structures is a basic requirement for sound regulatory intervention. Van Dijk advise its clients in how to apply the outcome of cost modelling exercises so that rates are set a the appropriate level to stimulate competition or to ensure that principles such as e.g. “the polluter pays” are respected.

Accounting Separation
 

Regulatory costing methodologies lie at the basis of preparing separated accounts. Van Dijk assist its clients in defining the required format and level of detail of separated accounts, complying with imposed information obligations while avoiding disproportionate administrative burden.

Audit

Through our experience in developing regulatory cost models, Van Dijk offer particular skills for challenging costing methodologies and auditing their implementation. Van Dijk perform audits for both public authorities (e.g. of cost models presented by operators for the justification of their rates) and for operators (e.g. as part of a consultation procedure).

Top-Down Cost Models (TDCM)

Starting from the financial accounts of an organisation and based on a cascade of cost allocation steps reflecting cost causation, costs per product and/or service can be determined. Top-down cost models allow for easy recuperation of all costs, but do not stimulate increase of efficiency.

Bottom-Up Cost Models (BUCM)

Bottom-up cost models allow taking into account a future optimised situation (e.g. based on a better dimensioning of the required technical capacity, more efficient operational processes, etc.) so that regulated wholesale rates can be set at the best level to stimulate competition.

Standard Cost Model (SCM)

For the assessment of the administrative burden of regulation, Van Dijk MC assist public authorities in developing and implementing Standard Cost Models. Based on these models, the most costly and time-consuming obligations are identified and measures are suggested for reducing the administrative costs.