On 15 July 2021 the AER published three draft working papers on Overall rate of return, Equity and Debt (the Omnibus papers).
The Omnibus papers ask for submissions on key technical aspects of the 2022 rate of return instrument process with areas of significance or proposed changes highlighted for the stakeholder and focus on key technical aspects of the rate of return and provide the AER’s preliminary positions and issues for further consideration, in particular:
- Overall rate of return draft working paper provides an overview of our rate of return framework, our decision-making process and our positions to date. It also explores a number of discrete topics that relate to the overall rate of return.
- Equity daft working paper explores a number of technical aspects of estimating the expected return on equity. In particular, we want to check that the approach we employ is robust in a range of market conditions.
- Debt draft working paper discusses the data that is available to allow us to set a return on debt that aligns with the debt costs that network businesses experience.
These papers provide the final opportunity for stakeholders to submit their views to us before our information paper which signals the start of making the 2022 rate of return instrument.
We also invited interested parties to make submissions on our draft working papers. Submissions closed on Friday, 3 September 2021. The final working paper will consider and respond to stakeholder submissions, and set out our preferred options. It may also identify areas of future work.