Ausgrid electricity prices to drop under new proposal

Ausgrid has submitted a proposal to the Australian Energy Regulator (AER) for a six per cent reduction in its network prices from 1 July 2019 following customer and stakeholder consultation on its 2019-24 Regulatory Proposal (the Proposal).

Ausgrid CEO, Richard Gross, said the Proposal sets out how much the business needs to invest in the next five years to deliver affordable, reliable and sustainable network services to its 1.7 million customers in Sydney, the Central Coast and the Hunter.

He said Ausgrid will provide customers a six per cent reduction in network prices and then prices will remain unchanged in real terms over the next four years to 2024.

“We’ve talked to our customers, we’ve listened and we’ve cut our network prices and we will keep listening,” Mr Gross said.

“At the same time, Ausgrid will make sure the network is reliable and sustainable.

“We are also making sure the Ausgrid network is ready for a future where renewables and distributed energy resources play a major role in the power mix. In the future, more households and businesses will choose to generate their own electricity and sell it back via the grid.

“While affordable energy is a major concern for customers, they also expect the network to be reliable, keep the lights on and for us to help them transition to a lower carbon economy.

“The grid will become a more flexible platform, which will be at the heart of future energy exchanges and we will support this transition while continuing to put downward pressure on our prices.”

Overall, Ausgrid’s network component of customers’ bills has reduced by 30 per cent from July 2013.

Mr Gross has also called for greater transparency in end use customer billing to enable customers to better understand the components contributing to their power bill.

“Customers rightly want to know how and why they are being charged for their energy and we support greater transparency in billing.”

Strategies outlined in the Proposal include:

• A sustainable capital investment strategy to ensure a reliable grid that also explores alternatives to capital investment over the period
• Better utilisation of existing capacity and only investing to replace assets when there is no alternative
• Increased investment in innovation by conducting trials and investing in new technologies
• Zero real growth in the value of our assets per customer
• Maintenance of reliability by optimising operational expenditure and capital expenditure to manage outage risks and improve response times
• Expansion of the grid to support growth areas eg Macquarie Park, (data, telco, education) and in Rozelle (future transport connections)
• Invest $335 million a year to replace aging assets and $43 million a year in technology (including cyber security)
• Invest $41 million in the Advanced Distribution Management System (ADMS) software platform to support the transformation of the network to a smart network.
• Invest $58 million to deliver the ‘future grid’ sooner (including trials allowing customers to generate, store and manage power)
• Demand Management Incentives Fund – continuation of partnerships with customers to encourage use of batteries, smart meters, smart appliances and innovative rebate offers