The Commission for Communications Regulation has issued a consultation paper on the cost of capital that Eircom should be allowed.
ComReg says this is a key input to the return Eircom is allowed to earn on its fixed-line business and is known as the Weighted Average Cost of Capital.
The regulator says it is important to set the correct value of the WACC to ensure that the correct regulated prices are achieved. It is also necessary to ensure that Eircom does not obtain too high a price at the expense of the consumer. Too low a price would also see Eircom under-recover its costs and compromise investment.
ComReg's consultation paper suggests that Eircom's WACC should be somewhere between 7.8% to 11.1%. Eircom's current WACC is 11.5%.
The regulator welcomes submissions from all interested parties and the consultation period will last until December 13.
