The Australian Energy Regulator today issued the 2010-11 electricity performance report for electricity transmission businesses in the National Electricity Market (NEM).
The transmission businesses covered in the report are ElectraNet (South Australia), Powerlink (Queensland), SP AusNet (Victoria), Transend (Tasmania), TransGrid (New South Wales) and the two interconnectors Directlink (Qld-NSW) and Murraylink (Vic-SA).
These transmission businesses operate the high voltage lines that transmit electricity from generators to cities and towns, and across state borders. Transmission network charges generally make up about 10 per cent of a household customer's bill and a much bigger proportion of a larger customer's electricity costs.
The AER’s objective in publishing these performance reports is to provide greater detail on how the businesses have performed against a range of measures and to maintain accountability for financial and service performance to consumers. Publishing the information also acts as an incentive for the transmission businesses to improve performance.
“Overall the financial and service performance has continued to improve in 2010-11,” AER Chairman Andrew Reeves said.
"First, service standards, which include the availability of the network to transport electricity, continue to improve with most businesses outperforming relative to historic trends. This outcome is consistent with the aim of the incentive arrangements, which encourage the businesses to improve operating practices to be more attuned to customer and market needs.”
"Secondly, the industry continues to spend less (both operating and capital expenditure) than was forecast for the current regulatory control period. The lower than expected level of capital expenditure reflects the slower than expected growth in demand and the deferral of some projects.”
“The lower than forecast opex suggests that the businesses are responding to the incentives provided by the regulatory regime to reduce costs. Customers share in these savings in future years,” Mr Reeves said.
"Thirdly, transmission businesses continue to improve their returns, with aggregate profits increasing by nearly 12 per cent between 2009-10 and 2010-11.”
The 2010-11 report provides comparative trends against the expenditure forecasts and service standards set in the AER’s revenue determinations.
A number of changes have been made to the 2010-11 report to better assist consumers to understand the performance of the industry. These include a focus on overall industry trends, including key drivers of industry performance.