Today the Australian Energy Regulator (AER) has published its draft amendments to the Revenue determination guideline for NSW non-contestable projects.
In 2024 the NSW Government made changes to the Electricity Infrastructure Investment Regulation 2021 (NSW) (EII Regulation) to provide flexibility in the way NSW Roadmap infrastructure projects are able to be delivered. The changes allow the AER to make revenue determinations for network infrastructure projects that combine both contestable and non-contestable components. We refer to these as hybrid revenue determinations. Our draft amendments to the guideline reflect the changes to the EII Regulation.
Our key amendment is to include a new chapter 7 in the guideline that outlines how for hybrid revenue determinations we intend to approach:
- contestable and non-contestable components
- the application of certain incentive schemes
- adjustment mechanisms
- the making of a hybrid revenue determination
- modifying the steps of the non-contestable process to accommodate contestable competitive assessment processes.
The draft amendments also include minor and administrative changes which incorporate changes to reflect up to date references to the regulatory framework.
We anticipate there may be future changes to the Electricity Infrastructure Investment Act 2020 (NSW) and the EII Regulation. At this stage we are consulting on how we intend to make hybrid revenue determinations to provide timely and clear direction to stakeholders on our proposed approach. We encourage stakeholders to provide feedback on our proposed approach.
