An independent report has shown a $1,4666 benefit to customers from the Australian Energy Regulator’s (AER)’s incentive schemes’ operation over 2006-2020.
The analysis produced by HoustonKemp for Energy Networks Australia (ENA) demonstrated how the AER incentive schemes have improved services for customers while helping reduce their power bills through lower network prices.
The report comes as the AER conducts its own review of incentive schemes. ENA Chief Executive Officer, Andrew Dillon, said incentive schemes have encouraged networks to become more productive and deliver more for network customers.
“This analysis shows households with a gas and electricity connection are $1,466 better off. This includes benefits that are already ‘locked-in’ under the current schemes and will continue to be delivered to consumers,” Mr Dillon said.
“Incentive-based regulation encourages networks to innovate and deliver value-for-money service, savings that are passed onto customers.
“Energy networks provide an essential service to almost every home and business in Australia. It is imperative that while networks exist in a regulated market without competition, they still deliver the best service to customers and the lowest cost.”
HoustonKemp’s analysis shows that the AER’s incentive schemes have delivered $18.6 billion (present value $2020) in benefits between 2006 and 2020 and customers have received most of these benefits ($13.4 billion).