Regulatory Asset Base (RAB)
A regulatory asset base is the value of a regulated company's investment on which the regulator allows it to earn a return and recover depreciation through its charges.
What is Regulatory Asset Base (RAB)?
Common in water and energy, the RAB approach lets a firm recover the efficient cost of approved investment over time. Ofcom considered it for BT's fibre investment, where costs could be recovered from both copper and fibre customers in an area, giving investment certainty while price caps protect consumers. It reduces but does not remove investment risk.