The AER has approved SA Power Networks’ (SAPN) 2020-21 electricity distribution tariffs in accordance with its 2020-25 revenue determination.
These tariffs will come into effect from 1 July 2020 and see the typical annual bill $32 lower for South Australian households and $58 lower for small business.
Electricity bills are made up of a number of components including the wholesale cost, retail margins and network charges. This decision relates to the network charges component of the bill.
The AER acknowledges that energy bills are a concern for many households and businesses at this time. As part of our Statement of Expectations for energy businesses during the COVID-19 pandemic we have provided advice for people impacted by the pandemic.
We encourage consumers to use the AER’s EnergyMadeEasy website, our free and independent price comparison tool, to find the best deal to suit their energy needs.
The AER sets the amount of revenue SAPN can recover from its customers over five years. Each year the AER checks that the tariffs in SAPN’s annual pricing proposal comply with its five-year revenue determination and the requirements of the National Electricity Rules. This pricing information is used by retailers in developing bills for their customers, in particular the network component of the bill.
In June, the AER approved SAPN’s 2020-25 network revenue determination. The determination allows SAPN to recover $3914.2 million from its customers in 2020–25.
The price decreases are primarily driven by the AER’s revenue determination for 2020-25. The price declines resulting from this revenue determination are partly offset by factors not set as part of the revenue determination, including its performance against incentive schemes, the pass-through of transmission costs and adjustments for changes in demand forecasts.
For explanation of the reasons for our decision and additional background information, please see the Statement of Reasons.