Today we have published a consultation paper outlining changes we propose to make to the distribution capex model and our proposed new standardised transmission model.
The standardised capex model has been used since 2021 for each electricity distribution determination, and we consider it timely to review the model in preparation for the 2028 distribution determinations. The model has streamlined the resources and consultation required between the AER and distributors to review and manage standard control services capex forecasts. This has increased consistency and reduced modelling errors across electricity distribution regulatory proposals. The standardised model has provided distributors with greater transparency regarding our decisions and how alternative forecasts are determined.
As part of our review of the distribution capex model, we are proposing to streamline the model to improve useability and readability. We propose to: improve inputs for immediate expensing, asset disposals and capitalised overheads; bring capex category output tabs up to date; and introduce input tables for the AER’s alternate forecast. We are seeking stakeholder feedback on our proposed changes, as well as any additional areas of concern, and elements of the current model which stakeholders feel could be streamlined.
As part of this review, we are proposing to introduce a standardised transmission capex model. The purpose of this model will be to improve consistency and transparency across transmission submissions, similar to the approach taken for distribution. The new transmission capex model will be based on the updated distribution capex model, tailored to the needs of transmission businesses. The main difference is the addition of input and output sheets to calculate capex on an ‘as commissioned’ basis. We are seeking stakeholder feedback on our implementation of ‘as commissioned’ forecasting, and whether certain input tables (such as capital contributions) can be safely removed, and our approach to categorising projects.
This review implements our commitments made as part of our response to the Treasurer’s request on regulatory reform opportunities to streamline and simplify obligations in the energy sector and find ways to reduce regulatory burden for stakeholders.
