The AER today released an expert report by Olan T Henry on equity beta estimation. The focus of the report is on the calculation of empirical estimates of the equity beta for the regulated gas and/or electricity transmission/distribution networks. The report was commissioned as part of the work associated with the Rate of Return Guideline released in December 2013. The Rate of Return Guideline is part of our Better Regulation program and sets out how we intend to apply the new rules framework to set rates of return for electricity and gas service providers, in order to promote the long term interests of consumers.
The equity beta is an important component of the rate of return.