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The business of “regulating” is becoming increasingly less technocratic and more sophisticated. Complexity, technological advancement and societal change are transforming the way that regulatory agencies operate. Traditionally tasked with ensuring access to and quality of public services, facilitating investments, and protecting market neutrality, regulators today are dealing with greater demands in a context of uncertainty. They need to be flexible, robust and aware – able to react to new trends, stand up to scrutiny, and actively collect and analyse data and information. Against this backdrop, good governance is all the more essential.
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The Commission for Regulation of Utilities (CRU) is an independent multi-sector regulator with a range of economic, customer and safety functions and duties in Ireland’s energy and water sectors. The CRU is a high-performing and well-regarded regulator that has, since its creation in 1999, successfully absorbed new functions and developed and implemented major policy reforms for the benefit of Irish consumers and the country’s economy.
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The Performance Assessment Framework for Economic Regulators (PAFER) was developed by the OECD to help regulators assess their own performance. The PAFER structures the drivers of performance along an input-process-output-outcome framework. This chapter applies the framework to the governance of Ireland’s Commission for Regulation of Utilities (CRU) and reviews the existing features, the opportunities and challenges faced by the CRU in developing an effective performance assessment framework.
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Measuring regulatory performance is challenging, starting with defining what to measure, dealing with confounding factors, attributing outcomes to interventions and coping with the lack of data and information. This chapter describes the methodology developed by the OECD to help regulators address these challenges through a Performance Assessment Framework for Economic Regulators (PAFER), which informs this review. The chapter first presents some of the work conducted by the OECD on measuring regulatory performance. It then describes the key features of the PAFER and presents a typology of performance indicators to measure input, process, output and outcome. It finally provides an overview of the approach and practical steps undertaken for developing this review.