AER invites submissions on three Rate of Return working papers

The Australian Energy Regulator (AER) has today released three draft working papers on the topics of Overall rate of return, Equity and Debt for consultation.

Our three working papers focus on key technical aspects of the rate of return and provide the AER’s preliminary positions and issues for further consideration, in particular:

  • Overall rate of return draft working paper provides an overview of our rate of return framework, our decision-making process and our positions to date. It also explores a number of discrete topics that relate to the overall rate of return.
  • Equity draft working paper explores a number of technical aspects of estimating the expected return on equity. In particular, we want to check that the approach we employ is robust in a range of market conditions.
  • Debt draft working paper discusses the data that is available to allow us to set a return on debt that aligns with the debt costs that network businesses experience.

Our working papers are laying a foundation for the development of the Rate of Return Instrument we will publish at the end of 2022. The rate of return has a substantial impact on the prices that customers pay for gas and electricity and so it is important that we hear from stakeholders to help us set the right level of return. 

Submissions to these papers will be considered as part of the final papers which are scheduled to be published in November 2021.

Stakeholders may make a single submission to all three papers and do not need to make individual submissions to each paper.

Public forums

There will be separate public online forums for the three papers. These will be held on:

  • Overall Rate of Return - Wednesday 4 August
  • Debt – Monday 9 August
  • Equity – Wednesday 11 August papers

Interested stakeholders should email and register to attend, you will be contacted with details on how to participate.

Invitation for submissions

Written submissions should be emailed to by close of business 27 August 2021

Alternatively, submissions can be posted to:

Mr Warwick Anderson
General Manager, Network Pricing
Australian Energy Regulator
GPO Box 3131
Canberra ACT 2601

We prefer that all submissions be sent in an electronic format in Microsoft Word or other text-readable document form and publicly available, to facilitate an informed, transparent and robust consultation process.

We will treat submissions as public documents unless otherwise requested. All non-confidential submissions will be placed on the AER's website. For further information regarding the AER's use and disclosure of information provided to it, see the ACCC/AER Information Policy. We request parties wishing to submit confidential information:

  • clearly identify the information that is the subject of the confidentiality claim
  • provide a non-confidential version of the submission in a form suitable for publication.

Enquiries about this paper, or about lodging submissions, should be directed to the Network Pricing branch (03) 9290 1800.

Issued date: 
15 July 2021
AER reference: 
AC 98/21
General enquiries - Rate of return