The Australian Energy Regulator (AER) is preparing to undertake distribution determinations for the Queensland electricity distribution network service providers (DNSPs), Energex and Ergon Energy. In undertaking this role the AER will determine the network charges for the regulatory control period 1 July 2010 to 30 June 2015.
Queensland DNSPs are currently subject to economic regulation by the Queensland jurisdictional regulator, the Queensland Competition Authority (QCA). The QCA is responsible for administering the distribution determination for the current regulatory period, 1 July 2005 to 30 June 2010.
The National Electricity Rules (NER) set out the general process the AER must follow in making distribution determinations. This process involves the AER publishing a final framework and approach paper (November 2008), receiving a regulatory proposal from each DNSP (May 2009) and undertaking a review of that regulatory proposal to make the AER's distribution determination (April 2010).
Framework and approach paper
The framework and approach paper is required to set out the AER's likely approach in its distribution determination to such matters as:
- the classification of distribution services
- the control mechanisms to be applied
- the application of a service target performance incentive scheme (STPIS)
- the application of an efficiency benefit sharing scheme (EBSS)
- the application of a demand management incentive scheme (DMIS)
As part of the transition to the new regulatory arrangements, the framework and approach paper for Energex and Ergon Energy is split into two stages. The two stages are:
- Framework and approach—classification of services and control mechanisms
- Framework and approach—application of schemes.
The AER released its preliminary positions paper setting out its likely approach to the application of a STPIS, an EBSS and a DMIS to Energex and Ergon Energy on 30 June 2008.
AER position paper on classification of services and control mechanisms
This position paper sets out the AER’s proposed approach to the classification of Energex’s and Ergon Energy’s distribution services and the control mechanisms to apply to standard control services and alternative control services in the 2010–15 regulatory control period. The AER must publish its framework and approach paper on these matters by 31 August 2008.
Invitation for submissions
Interested parties are invited to make submissions on the AER’s proposed positions paper. This paper, the DNSPs proposals and further information about the process the AER must follow in making its distribution determinations is available from the AER’s website.
Submissions can be sent electronically to AERinquiry
aer [dot] gov [dot] au (AERinquiry[at]aer[dot]gov[dot]au), or alternatively mailed to:
Mike Buckley
General Manager
Network Regulation North Branch
Australian Energy Regulator
GPO Box 3131
Canberra ACT 2601
The closing date for submissions is 28 July 2008.
To facilitate an informed, transparent and robust consultation process the AER prefers that all submissions be in an electronic format and publicly available. Accordingly, submissions will be treated as public documents and posted on the AER’s website, except and unless prior arrangements are made with the AER to treat the submission, or portions of it, as confidential.
Enquiries about this paper, or about lodging submissions, should be directed to the Network Regulation North Branch.