AER works with industry to foster good practice asset replacement planning

The Australian Energy Regulator (AER) has released an industry practice application note to support network businesses in adopting good practice asset replacement planning. To help industry and other stakeholders to get the most out of the application note, we will also hold a follow up forum in Melbourne on 26 February 2019.

The application note aims to give network businesses more confidence that they are meeting the network planning framework in the National Electricity Rules (NER). Providing this confidence will be valuable to industry in improving transparency around asset retirement, de-rating and replacement decisions under the replacement expenditure rule change.

The application note is a companion piece to our new application guidelines for the regulatory investment tests, which assists network businesses in applying a cost benefit analysis when making large investment decisions.

This note stems from collaboration with industry rather than a requirement under the NER. It has a technical focus for network planners and asset managers that are applying economic assessments to asset replacement decisions, and draws on their experience to date. The application note has been developed in consultation with these network planners and asset managers, as well as consumer representatives.