Rate of Return Instrument 2022

Category: 
Rate of return
Status: 
Date initiated: 
4 November 2019
Effective date: 
31 December 2022
Contact: 
General enquiries - Rate of return RateOfReturn@aer.gov.au
AER reference: 
65402

Overview

The Rate of Return Instrument sets out the approach by which we will estimate the rate of return, and comprises the return on debt and the return on equity, as well as the value of imputation credits.

We publish a new rate of return instrument every four years. The next rate of return instrument is to be published in 2022 and will bind all regulatory determinations in the subsequent four years.

To determine the 2022 instrument we will undertake an extensive review including multiple rounds of stakeholder consultation. We expect the active phase of this review will commence in the middle of 2021.

The 2018 Instrument remains in force until the publication of the 2022 instrument.

On 26 May 2020 we released a position paper on our pathway to the 2022 instrument. This high level document sets out the timelines and process steps we will follow to develop the 2022 instrument.

Our pathway to 2022 includes a series of working papers in advance of the main phase of the review:

We will also release an annual update at the end of each year.

Our pathway to 2022 also sets out the role for stakeholder reference groups in our 2022 review. We are currently inviting expressions of interest to join our Investor Reference Group and our Retailer Reference Group.