AER review of electricity transmission and distribution WACC parameters
The National Electricity Rules (NER) provide that the AER may review the weighted average cost of capital (WACC) parameters to be adopted in determinations for electricity transmission and distribution businesses. Reviews are to be conducted at intervals of five years, with the first interval starting from 31 March 2009.
The outcomes of this review apply to all electricity determinations where the proposal is submitted between 1 May 2009 and before the completion of the AER's second review, in 2014. For transmission determinations, the WACC parameters must be as per the outcomes of this review. For distribution determinations, a departure from the outcomes of this review is allowed for individual determinations if there is persuasive evidence to do so.
Final statements
On 1 May 2009, the AER released its final statement (transmission) and final statement of regulatory intent (distribution) on the revised WACC parameters. The AER also published its final decision on the WACC parameters, and consultant reports commissioned by the AER in the context of the final statements.
On 11 December 2008, the AER released its proposed statement (transmission) and proposed statement of regulatory intent (distribution) on the revised WACC parameters. The AER also published its explanatory statement on the proposed WACC parameters, and consultants reports commissioned by the AER in the context of the proposed statements.
On 6 August 2008, the AER released an issues paper canvassing issues relevant to this review. Submissions on the issues paper closed on 17 September 2008.
