The Australian Energy Regulator (AER) has approved the amended pricing methodologies submitted by transmission network service providers (TNSPs) – Transgrid, ElectraNet, AusNet Services, Powerlink, TasNetworks, Ausgrid and AEMO.
Our final decision allows the TNSPs to set prices for system strength services from the 2023–24 year onwards based on their proposed calculation method.
The AER amended the proposed indexation in AEMO’s pricing methodology to reflect actual (rather than forecast) inflation. This is consistent with the proposed indexation in the other methodologies.
A pricing methodology sets out the TNSP’s approach to recover costs as regulated under chapter 6A of the National Electricity Rules (NER). These costs relate to the provision of prescribed transmission services, including system strength services.
The AER assesses a pricing methodology for compliance against the requirements of the NER and our transmission pricing methodology guidelines. This pricing methodology is then applied by the TNSPs to set its annual charges.
The TNSPs submitted their proposed pricing methodologies in November 2022. This followed amendments to our transmission pricing methodology guidelines (published 25 August 2022) to include how to price system strength services in the National Electricity Market.