AER invites submissions on late ring-fencing waiver application

SA Power Networks (SAPN) has submitted to the AER a late application for waiver from the Electricity Distribution Ring-fencing Guideline (Guideline). The AER has issued a draft decision proposing to grant this waiver application. We invite submissions from interested parties by 5pm AEDST on Monday 20 November 2017 to assist us in our decision on this matter.

SAPN currently has a number of contracts with large customers for the provision of construction and maintenance services. It intends to transfer these contracts to its affiliate, Enerven, in order to achieve compliance with the Guideline. The contracts are not contestable and are already provided under the Enerven brand.

SAPN is currently awaiting a decision from the Australian Taxation Office (ATO) on whether it will incur a tax liability for the transfers. It submits that such costs would be substantial, and would need to be passed on to consumers. A favourable ruling from the ATO would enable SAPN to avoid these additional costs.

SAPN has requested the waiver to provide it with a short period of additional time beyond the 1 January compliance deadline to await the ruling and arrange to transfer the contracts. SAPN would comply with all other aspects of the Guideline.

Find out more about making a submission.  

Issued date: 
3 November 2017
AER reference: 
AC 148/17