Service target performance incentive scheme - 2017 amendment

Sector: 
Segment: 
Status: 
Category: 
Service target performance incentive scheme
Date initiated: 
5 January 2017
Effective date: 
30 November 2018
Contact: 
Mr David Chan, Director -Network operations david.chan@aer.gov.au
AER reference: 
60666

Overview

On 5 January 2017, the AER published an issues paper on its intention to review the Service Target Performance Incentive Scheme (STPIS) and the establishment of a Distribution Reliability Measures Guideline. This issues paper sought stakeholders’ feedback on issues we identified in implementing the STPIS since 2009 and outlines our position on setting up uniform distribution reliability measures across all jurisdictions.

On 14 December 2017, the AER released the draft amended Service Target Performance Incentive Scheme (STPIS) for consultation.

Accompanying the draft amended STPIS is an explanatory statement outlining our reasons for amending the STPIS and seeks stakeholders’ responses on adopting these changes.

Energy consumers and other interested parties were invited to make submissions on the draft amended STPIS by 9 February 2018. We received 14 submissions that are listed under the 'draft decision' milestone.

Background

The AER creates, administers and maintains the Service Target Performance Incentive Scheme (STPIS) in accordance with the requirements of the National Electricity Rules (Electricity Rules). The purpose of the STPIS is to provide incentives to electricity distributors to maintain the existing supply reliability performance and to make improvement to the extent to match customers’ value on supply reliability.

We currently apply the STPIS scheme to distributors in the Australian Capital Territory, New South Wales, Queensland, South Australia, Tasmania and Victoria. Our last review of the STPIS was in 2009 and we now consider it timely to review the scheme to account for the lesson learnt in implementing the scheme.

This review seeks stakeholders' feedback on several aspects of the STPIS scheme design identified by us from our operational experience of the scheme to date.

We also conduct this review in conjunction with the establishment of a Distribution Reliability Measures Guideline to set out a set of common definitions of reliability measures that can be used to assess and compare the reliability performance of distributors.