The Australian Energy Regulatory (AER) has recently published two issues papers relating to open price determinations for:
- Powerlink‘s electricity transmission revenue proposal; and
- TasNetwork‘s electricity distribution revenue proposal.
Both issues paper review the new revenue proposals and their individual building blocks against past performance and pose common questions for both service providers around:
- Has the Service Provider sufficiently justified its capex proposal?
- Has the Service Provider adequately considered customer views in developing its capex proposal?
- Do you consider the Service Provider has sufficiently justified its opex proposal?
- Do you consider the Service Provider has adequately considered customer views in developing its opex proposal?
- Do you have any comments on the Service Providers proposed approach to calculating the rate of return?
- Please provide your comments on the quality of the consumer engagement conducted by the Service Providers in preparing its revenue proposal.
There are also specific questions for each company as follows:
- Has PowerLink applied an appropriate method to calculate its depreciation allowance?
- Do you agree with TasNetworks’ proposal to use a gamma value of 0.25 in valuing imputation credits?
- Do you agree with TasNetworks’ proposal for an incentive payment of ± 2.5 per cent?
Interested parties have until 28 April 2016, to respond to questions in each of the issues papers. The AER will also be holding public forums in Brisbane (Powerlink) and Hobart (TasNetworks) in March to discuss the revenue proposals.