Directlink's cost allocation method (CAM) governs the manner in which Directlink is allowed to allocate costs to the distribution services that it provides. The allocation of costs between the services is required to accurately represent the costs incurred in providing those services. This prevents cross-subsidisation between the distribution and other services that Directlink provides.
On 16 October 2009, the owners of Directlink, Energy Infrastructure Investments Group (EII Group), approached the AER seeking to amend Directlink's CAM. The AER is required to approve or refuse to approve the proposed Amended CAM in accordance with the AER's Cost Allocation Guidelines.
Directlink's current CAM was approved in March 2010 under chapter six of the National Electricity Rules. This cost allocation method replaces the CAM previously approved by the AER in August 2008.