Light regulation financial reporting guideline

Date initiated: 
31 May 2019
Effective date: 
31 October 2019
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Under Rule 63 of the National Gas Rules (NGR), the Australian Energy Regulator (AER) is required to publish and maintain the Financial Reporting Guideline for light regulation pipelines. The AEMC introduced the requirement for the AER to prepare these guidelines during its review of Parts 8-12 of the NGR.

The financial reporting guideline will be developed by the AER, in collaboration with the Economic Regulation Authority Western Australia (ERA), with the assistance of specialist consultants.

The AER is also required to monitor and enforce compliance of the pipeline operators with the information disclosure requirements set out in the guideline.

Guideline summary

The guideline will specify the financial and weighted average price information service providers are required to prepare and publish on their website. The information requirements specified in the guideline include:

  • a statement of pipeline revenue and expenses
  • a statement of pipeline assets
  • financial performance metrics
  • asset valuation
  • weighted average price information
  • audit assurance

A reporting template will accompany the guideline to ensure consistency of the data collected and information reported. Service providers will be required to publish a basis of preparation document with the template, setting out the sources of information, allocation methods and assumptions for estimates.

In addition to the financial reporting guideline and template, an explanatory statement will be prepared to provide context to the guideline. The explanatory statement will include detail on the legislative basis, AER consideration of the costs and benefits of the guideline, and direction on how the guidelines are to be applied.

Next steps

The AER has engaged consultants to prepare a draft financial reporting guideline, which will be released towards the end of June 2019 for public consultation. We will be undertaking targeted consultation with light regulation pipeline owners and other affected stakeholders between now and the release of the draft guidelines in June, and interested parties are welcome to make submissions during this time. A revised guideline incorporating stakeholder feedback, a reporting template and an explanatory statement will be published before October 2019.


On 14 March 2019, the AEMC made a final determination to implement a range of improvements to the regulation of covered pipelines across Australia. As part of this determination, a financial reporting guideline for light regulation pipelines must be prepared by 31 October 2019.

On 19 December 2017, the AER released its Financial Reporting Guidelines for Non-Scheme Pipelines. We propose to produce a similar guideline for light regulation pipelines, with amendments focusing on the methodology for asset valuation. Specifically, the recovered capital methodology will be excluded.