The Australian Energy Regulator (AER) has made its final decision for the ActewAGL Distribution ACT, Queanbeyan and Palerang gas distribution network’s access arrangement proposal for the period 1 July 2010 to 30 June 2015. The AER’s final decision approves network charges and the terms and conditions of access for the ACT, Queanbeyan and Palerang gas distribution network for the period.
There will be an average increase in reference tariffs in 2010-11 of 7.0 per cent for residential customers as at 1 July 2010. As a result, the gas bill for the average retail customer is expected to increase by about 52 cents per week. Network charges for over 100 000 retail customers of the network will increase on average by 2.9 per cent annually in real terms in the remaining four years of the access arrangement period.
The higher network charges reflect the approved total revenue of $278.7 million ($2009–10). This is the result of the weighted average cost of capital (WACC) of 9.72 per cent, which is 1.12 percentage points higher than the current cost of capital. The total revenue also includes higher projected capital expenditure of $85.0 million ($2009–10) for projects to increase the capacity of the network, for upgrades and renewal of the existing network and to support customer growth. Higher operating expenditure of $112.4 million ($2009–10) reflects an increase in the operating and maintenance costs and higher corporate overhead costs.
AER’s access arrangement proposal
The AER’s final decision does not approve ActewAGL Distribution’s revised access arrangement proposal including the access arrangement information addendum. ActewAGL Distribution’s revised access arrangement proposal did not fully meet the requirements of the AER’s draft decision. The final decision outlines the revisions required to the revised access arrangement proposal and the access arrangement information addendum. The revisions are contained in the AER’s access arrangement proposal including the access arrangement information, which is an annexure to the final decision.
The AER intends to approve its access arrangement proposal on 23 April 2010.
Further information and inquiries
Relevant information including the AER’s final decision including the AER’s proposal can be found on the AER’s website. For any other inquiries about the gas distribution reviews 2009–2010, please contact the AER on (02) 6243 1233. Alternatively, inquiries can be sent electronically to nswactgas
aer [dot] gov [dot] au (nswactgas[at]aer[dot]gov[dot]au).