Issue date
AER reference
AC 188/22

The Australian Energy Regulator (AER) has published a draft decision on its Review of incentive schemes for regulated networks.

The draft decision:

  • retains the Efficiency Benefit Sharing Scheme (EBSS)
  • varies the Capital Expenditure Sharing Scheme (CESS) by implementing a tiered arrangement
  • improves transparency by requiring networks to explain differences between our expenditure forecasts and actual expenditures
  • proposes a review of the Market Impact Component of the transmission Service Target Performance Incentive Scheme (STPIS) to commence in the second half of 2023.

The draft decision was informed by stakeholder submissions in response to our discussion paper (released December 2021), our position paper on CESS (released in August 2022) and a stakeholder workshop held in August 2022.

Changes to our 2013 Capex Incentive Guideline will be required in order to implement our draft decision. We have released draft amendments to the guideline for comments.


We invite stakeholders to make submissions on this draft decision, including views on proposed amendments to the draft Capex Incentive Guideline and whether the changes should apply to the upcoming NSW, ACT and Tasmanian resets which commence early in 2023. We seek comments by Friday, 3 March 2023. Submission should be sent to incentivereviewataer [dot] gov [dot] au (incentivereview[at]aer[dot]gov[dot]au).