DBP Access Arrangement (2016-2020)

Access Arrangements & Price Determinations

Apr 20
DBP Access Arrangement (2016-2020)

On 20 April 2015, the ERA published an issues paper on the upcoming access arrangement.  Public submissions were due by 2 June.

Key issues for comment were identified as:

  • A revenue requirement of 2.2bn over AA4, which is 2% higher than AA3 revenue, with a move from a price cap to revenue cap model.
  • A proposed post tax nominal cost of capital of 8.36% (11.71% Return on Equity and 6.13% Return on Debt).
  • No planned pipeline extensions through AA4, resulting in a lowered forecast capital expenditure of $107m over the period.
  • Proposed annual operating costs of $112m which is 3% lower than allowable operating costs in AA3 but 38% higher than actual annual operating costs over the first 3 years of AA3.

Previous activity:

  • 11 Feb 2015 – The ERA sought public comment on the proposed revised access arrangement for the Dampier to Bunbury Natural Gas Pipeline (DBNGP), submitted to the ERA on 31 Dec 2014.
  • 10 public submissions were received in response, including papers from Alinta, BHP, United Energy and MiltiNet Gas and Wesfarmers.

Background:

  • The DBNGP is a transmission pipeline which extends approximately 1600 kilometres from Dampier in the Pilbara region, through to Perth and Bunbury in the South West region.