South Australia power lines

The Australian Energy Regulator (AER) has remade the draft decision on the amount of revenue Ausgrid can recover for the five‑year 2014-19 regulatory period.

In 2015, Ausgrid proposed to recover $12.05 billion from consumers over the 2014-19 regulatory period, but the AER approved the significantly lower amount of $8.7 billion in its final decision. Legal action followed, resulting in our 2015 final decision being set aside by the Australian Competition Tribunal.

AER has remade the set aside decision. If this draft decision becomes the final decision, Ausgrid will be allowed to recover revenues of $9.1 billion from its customers over the 2014‑19 regulatory period. This will result in a revenue allowance of $341.1 million (or 3.9 per cent) above the revenue approved in the 2015 final decision.

The draft decision will result in approximately $310.9 million being returned to customers in the next regulatory period, in line with Ausgrid’s proposal and after the application of corrective modelling adjustments.

The remaking of the determination follows the end of limited merits and judicial review processes in May 2017 arising from the AER’s 2015 final decision.

Ms Conboy said the process demonstrated the AER’s commitment to helping ensure efficient spending by networks.

“Consumers do not want to pay any more than needed for safe and reliable electricity, and this decision reflects that. At a time when energy affordability is a key concern, Australian businesses and households can take confidence from decisions like this,” Ms Conboy said.

The AER welcomes further comment from consumers and other interested stakeholders as it moves toward making a final decision by March next year. Stakeholders are invited to make written submissions on the draft decision by 20 December.

Under a separate determination process, the AER released its draft decision on Ausgrid’s revenue proposal for the next (2019‑24) regulatory period, on 1 November.

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