ActewAGL - Determination 2014-19

Sector: 
Segment: 
Commencement date: 
13 December 2011
Regulatory period: 
1 July 2014 to 30 June 2019
(5 years)
Status: 
Contact: 
AER General inquiries AERInquiry@aer.gov.au

Overview

On 30 April 2015, we released our final decision on ActewAGL's distribution determination for the 2014-19 regulatory control period.

On 20 May 2015 the AER wrote to the NSW and ACT network businesses setting out how it proposes to correct a small number of administrative errors in its 30 April determinations. This is to ensure that the associated legal documents accurately reflect its decisions.

In May 2015, ActewAGL applied to the Australian Competition Tribunal for merits review and the Federal Court for judicial review of the AER’s final 2014-19 distribution determination. The tribunal made its decision on 26 February 2016. It remitted the decisions back to the AER to be remade in accordance with its orders as to the value of imputation credits (gamma), return on debt, operating expenditure (opex) and the service target performance incentive scheme (STPIS).

In March 2016 the AER applied to the Federal Court for judicial review of the Australian Competition Tribunal decisions to set aside the NSW and ACT electricity and gas distribution network revenue determinations. In May 2017, the Full Federal Court handed down its decision on the AER's appeal of the Tribunal decision. The Court upheld the AER's appeal in respect of the Tribunal's construction of the rules regarding gamma. The Court dismissed the AER's appeal over the Tribunal's ruling on return on debt and opex of the electricity businesses. The AER must therefore revisit its decision on these matters.

Background

The AER is required to determine the revenue allowance for ActewAGL under the National Electricity Rules. The AEMC deferred the full regulatory determination process for ActewAGL’s next regulatory control period (2014–19). As part of the transitional arrangements, the AER determined a placeholder revenue allowance for a transitional regulatory control period (1 July 2014 to 30 June 2015) on 16 April 2014.

On 2 June 2014 the AER received a regulatory proposal from ActewAGL. The AER did not publish ActewAGL's proposal, as it was not compliant with the NER. The AER issued ActewAGL with a notice under clause 6.9.1(a) of the NER, to resubmit its regulatory proposal. On 10 July 2014, ActewAGL resubmitted its regulatory proposal which addressed the deficiencies identified by the AER.

Following receipt of ActewAGL’s resubmitted proposal, the full determination process commenced. The AER assessed the revenue allowances for the whole regulatory control period (1 July 2014 to 30 June 2019). In the full determination, the AER trued up any difference between the placeholder revenue allowance for the transitional year and the revenue requirement for the transitional year that is established in the full determination process.