The Australian Energy Regulator (AER) has today published its decision on ElectraNet’s contingent project application for its Mid North South Australia Renewable Energy Zone (REZ) Stage 1a early works. This project was identified by AEMO as an actionable project in the 2024 Integrated System Plan (ISP).
Following consultation, the AER’s decision is to approve the proposed capital expenditure of $45.7 million ($2022–23) for ElectraNet to undertake Stage 1a early works. We have assessed that ElectraNet’s proposed incremental capital expenditure for these early works is prudent and efficient. We also determined that all trigger events for this contingent project application have been met and the project costs exceed the materiality threshold.
The Stage 1a early works costs approved by the AER will be added to ElectraNet’s total maximum allowed revenue for the 2023–28 period. This adjustment will be reflected in customer bills from 2026–27 onwards, with an estimated increase of $0.56 per annum in residential electricity bills in South Australia.
In support of its application lodged on 28 March 2025, ElectraNet submits that undertaking early works will enable it to:
initiate community and stakeholder engagement, including consultation with Traditional Owners, to support social licence and inform project development
commence easement acquisition activities on the critical path to achieve the target delivery date of July 2029
progress project planning activities to ensure its Stage 2 application (which will include the bulk of the Project’s costs) will be as low as possible
The project is subject to the Regulatory Investment Test for Transmission (RIT-T), and as part of this process, ElectraNet is required to publish a Project Assessment Draft Report (PADR) by December 2025. The PADR will identify the credible options for meeting the need identified by AEMO. If the project proceeds as expected, we will receive a Stage 1b early works contingent project application from ElectraNet seeking approval for the next phase of early works leading up to the Stage 2 submission.
Background
The Mid North South Australia REZ Expansion is a proposed transmission project that will involve constructing new 275 kV and 132 kV transmission lines to connect renewable energy sources to Adelaide and support growing industrial demand. AEMO’s 2024 ISP confirms the earliest feasible in service timing for the Mid North South Australia REZ Expansion project is July 2029.
A contingent project application outlines the amount of revenue a network business seeks to recover from its customers to deliver a project. The AER’s role is to assess whether the trigger event for an actionable Integrated System Plan project has been satisfied and to review the reasonableness of the proposed costs of the project.