The National Electricity Rules require the AER to undertake a review every three years of the cost thresholds associated with the regulatory investment test for transmission (RIT-T) and the regulatory investment test for distribution (RIT-D) to ascertain whether these cost thresholds need to be changed to reflect changes in input costs to maintain their appropriateness. On 31 July 2015 the AER commenced the 2015 cost thresholds review. The cost thresholds review and the publication of the draft determination is being conducted in accordance with clause 5.15.3 of the National Electricity Rules.
The AER has published a draft determination for the 2015 review of the cost thresholds associated with the regulatory investment test. The AER’s draft determination is that:
- for the RIT-T cost thresholds, the $5 million cost thresholds refererd to in clauses 5.15.3(b)(1),(2),(3)(4) and (6) of the National Electricity Rules should be increased to $6 million and the $35 million cost threshold referred to in clause 5.15.3(b)(5) of the NER, which was inceased to $38 million in the 2012 cost thresholds review be increased to $41 million
- for the RIT-D cost thresholds, the $20 million cost threshold referred to in clause 5.15.3(d)(4) be increased to $21 million and the other RIT-D cost thresholds listed in clause 5.15.3(d) of the National Electricity Rules remain unchanged.
The RIT-T and RIT-D are cost-benefit tests that network businesses must apply before building electricity network infrastructure. Network businesses are required to apply the relevant test in instances where the capital costs of proposed transmission investments are above certain cost thresholds.
Invitation for submissions
We are now seeking submissions from interested stakeholders on our draft determination by COB 9 October 2015.
Submissions should be emailed with the following title “Submission to AER - 2015 cost thresholds review” at AERInquiry
aer [dot] gov [dot] au (AERInquiry[at]aer[dot]gov[dot]au).
Alternatively, written submissions can also be sent to:
Mr Peter Adams
General Manager - Wholesale Markets Branch
Australian Energy Regulator
GPO Box 520
Melbourne VIC 3001
The AER prefers that all submissions be sent in an electronic format in Microsoft Word or other text readable document form and publicly available, to facilitate an informed, transparent and robust consultation process. Accordingly, submissions will be treated as public documents and posted on the AER's website, unless prior arrangements are made with the AER to treat the submission, or portions of it, as confidential. Those wishing to submit confidential information are requested to:
- clearly identify the information that is the subject of the confidentiality claim; and
- provide a non-confidential version of the submission.