AER statement – Maintenance allowances for regulated energy businesses

The AER met with representatives from the Electrical Trades Union (ETU) today to discuss maintenance funding of regulated businesses.

The AER’s role as economic regulator is to determine the prudent and efficient costs of running and maintaining the NEM to ensure consumers pay no more than necessary.

Since 2012 the AER has provided overall funding for network businesses of over $90 billion, while actual spend has been over $80 billion. This represents underspend of allocated expenditure of over $10 billion since 2012. Furthermore, over the past five years the overall underspend of allocated replacement capex by networks provided by the AER, which is a core component of most safety related expenditure, was $1.8 billion.

Over the same period, network reliability has increased, with a significant reduction in network outages since 2010. This indicates businesses have sufficient revenue to maintain the required service standards. Indeed, the data illustrates that as a result of AER actions, consumers are now paying less in network costs for a more reliable network.[.no-lexicon]

The letter from the AER to the ETU is available below.

Sector: 
Issued date: 
9 February 2022
AER reference: 
AC 23/22
Contact: 
AER Media 0466 409 921 media@aer.gov.au