International regulatory approaches to rate of return - Pathway to Rate of Return 2022

Rate of return
Date completed: 
16 December 2020
Date initiated: 
27 August 2020
Effective date: 
16 December 2020
General enquiries - Rate of return
AER reference: 


This is the second topic in a series of working papers that we will produce as part of our pathway to the 2022 rate of return instrument. The outcomes from these working papers will feed into the active phase of our 2022 rate of return instrument review. This information will assist us to set a rate of return that contributes to the achievement of the National Gas Objective and National Electricity Objective.

The draft working paper (published 27 August 2020) reviewed the approach taken by a number of overseas regulators to setting the rate of return. It identified similarities and differences between our current approach and the approaches used internationally. It provided context by analysing the overall regulatory framework and environment in which different regulators operated.

There was an online forum to discuss the draft working paper on Wednesday 16 September 2020. The submission period closed on Friday 9 October 2020. Presentations from the forum and all stakeholder submissions are available on the consultation page.

The final working paper (published 16 December 2020) considers and responds to stakeholder submissions, and sets out our preferred options for how we might improve our approach in view of overseas regulatory practice. It sets out areas of future work that will be informed by international rate of return approaches, as part of our Pathway to 2022.