AER - Gearing Discussion paper - February 2018

On 15 March 2018 the AER held its first concurrent expert evidence session as part of its review of the rate of return guidelines. This was a closed session to allow detailed and natural discussion between the AER Board and the participating experts.

Disclaimer: In the interests of transparency and to assist stakeholders in having prompt access to a transcript of the first concurrent evidence session, the AER has published an un-proofed version of the transcript of evidence session 1 held on 15 March 2018. This version should not be relied upon.

The final proofed version of the transcript is now available.

The purpose of the concurrent expert evidence sessions is to assist the AER Board in making a decision which will best achieve the national gas and electricity objectives by allowing them to clearly define the issues of agreement and areas of disagreement between relevant experts.

On 28 February 2018 we released three discussion papers on the following matters to be discussed at the first concurrent evidence session:

• Gearing
• Financial performance measures
• Risk and judgement

The discussion papers provide background on the matters to be discussed at the concurrent evidence sessions and questions to frame that discussion.

We have also published a report by Darryl Biggar, referenced in the Financial performance measures discussion paper. This paper outlines his views on the information value of RAB multiples.