The Australian Energy Regulator (AER) received a notification from Moorabool and Central Highlands Power Alliance Inc. (MCHPA) disputing conclusions made in AEMO Victoria Planning (AVP) and TransGrid’s Project Assessment Conclusions Report (PACR) for the Victoria NSW Interconnector West (VNI-West) regulatory investment test for transmission (RIT-T).
MCHPA has raised the dispute under clause 5.16B of the National Electricity Rules (NER) on multiple grounds including that it considers AVP and Transgrid did not comply with specific provisions of the NER concerning the application of VNI-West RIT-T.
Among other grounds raised in its dispute notice, MCHPA considers AVP and Transgrid did not comply with NER provisions concerning the identification of credible options and selection of preferred option in the VNI-West PACR.
The AER is currently assessing the grounds raised in the dispute notice.
The AER has not formed any views on the grounds of dispute raised in the dispute notice.
The AER intends to make a dispute resolution decision as soon as possible within the statutory timeframes.
The RIT–T is a cost‒benefit analysis that transmission businesses apply before making network investments in excess of $7 million. The purpose of the RIT–T is to identify the network or non-network investment option with the highest net economic benefits across the National Electricity Market. This promotes efficient investment decisions and helps ensure that consumers pay no more than necessary for electricity network infrastructure.
Under the dispute resolution framework set out in the NER, disputes can be raised within 30 days of the project proponent publishing the PACR. The 30-day dispute period for the VNI-West RIT-T PACR ended on 26 June 2023.
As part of the dispute resolution process, the AER may reject the dispute if it considers the grounds are misconceived or lacking in substance.
The AER also has the role of assessing whether the RIT-T has been correctly applied. Where instances of a misapplication of the RIT-T are identified, the AER may, as part of its determination, direct the network business to amend its PACR to ensure the RIT-T is applied in accordance with the requirements of the NER.
The AER has 40 calendar days to make a decision on a dispute. The AER may extend this timeframe to up to 100 calendar days if the issues involved are complex or difficult.