The AER has received the first round of Tariff Structure Statement (TSS) proposals from the Victorian electricity distribution businesses: CitiPower, Jemena, Powercor and United Energy. Accessible via the attached links. AusNet Services’ proposal will be submitted at a later date.
Distributors in other jurisdictions of the National Electricity Market (NEM) will be submitting their TSS proposals later in the year or in early 2016.
Consumers are charged a price from their retailer for their electricity use. Distribution prices are part of the electricity charge that consumers ultimately pay.
The process by which distributors convert their revenues into tariffs is governed by a new set of arrangements in the National Electricity Rules (NER). The Australian Energy Markets Commission made a series of changes to the pricing rules in November 2014. These originated in recommendations from their earlier Power of Choice review that were then actioned into rule change proposals from governments. Broadly, these new rules aim to achieve three objectives:
- Better signals of the cost drivers of distribution networks.
- The explicit consideration of the impact of changing tariffs, as part of a stakeholder dialogue based approach to their design and implementation.
- Transparency and greater certainty as to the tariff strategies that will be employed during a regulatory period.
The AER expects to run a series of public consultation stages, including the release of an issues paper (expected towards the end of 2015), seeking to arrive at draft decisions by 22 February 2016 and final decisions by 29 July 2016 on the Victorian TSS proposals. Dates and further information on these consultation stages will be announced shortly.