Submission to AER Revenue determination guideline for non-contestable network infrastructure projects

PIAC made a submission to the Australian Energy Regulator’s (AER) review of the Revenue determination guideline for non-contestable network infrastructure projects.

This is the first of a series of consultations that will concern how the AER will manage revenue determinations for projects regulated under the auspices of jurisdictional frameworks, in this case the NSW Electricity Infrastructure Investment Act 2020 (the EII Act).

The most important issue for discussion was the very short time frame the EII Act affords the AER to conduct revenue determinations compared with what the AER is used to under the National Electricity Rules.

To mitigate the risks of the AER making poor or poorly informed decisions which could ultimately result in NSW consumers overpaying for their energy, PIAC proposes the institution of a standing reference panel of experts and stakeholder representatives to provide advice to the AER in all revenue determinations that occur under the EII Act.

We also proposed adding clear triggers or opportunities for the AER to seek extra time to make a decision concerning revenue where there is a complex or new issue to consider. This would balance network businesses’ need for stable and certain conditions in which to make investment decisions with the AER’s duty to ensure investments are in the long term interest of consumers.