Roll forward model (distribution) - December 2016 amendment

Roll forward model
Date initiated: 
31 August 2016
Effective date: 
15 December 2016
Kenny Yap, Director - Financial modelling (02) 6243 1224
AER reference: 


The AER has published a new version of the roll forward model (RFM) that apply to future electricity distribution determinations. The main change is that the new RFM provides an option for selecting a forecast or actual depreciation approach to be used to roll forward the RAB. It also gives effect to the AER’s Rate of return guideline, allowing for an annual update for the return on debt.

The National Electricity Rules (NER) requires that the AER develop and publish certain guidelines, models and schemes that will be applied to distribution networks service providers. On 15 December 2016, in accordance with clause 6.5.1(c) of the NER, the AER published:

  • An amended distribution RFM (version 2) and associated handbook.
  • A final decision document and associated log of detailed changes to the RFM.