The Financial Reporting Guideline for Non-scheme Pipelines—released today by the Australian Energy Regulator (AER)—aims to better inform negotiations for gas shippers seeking access to unregulated pipelines.
The Guideline specifies the financial information unregulated pipeline owners are required to prepare and publish on their website.
“The publication and exchange of pipeline financial information will address the information imbalance between unregulated pipeline owners and shippers, facilitating timely, efficient and effective negotiations on access to pipeline services,” said AER Acting Chair Cristina Cifuentes.
Disclosure of the financial information set out in the Guideline will enable prospective users of non-scheme pipelines to make an informed decision on the reasonableness of an offer made by the pipeline owner.
“We have developed a Guideline that is fit for purpose, targeted and proportionate, to support efficient and effective commercial negotiations,” Ms Cifuentes said.
“Ultimately we expect these reforms will help to lower gas transportation costs and flow through to benefit end customers,” said Ms Cifuentes.
Background:
The Guideline is a key component of the information disclosure and arbitration framework recommended by Dr Michael Vertigan AC and endorsed by the COAG Energy Council. The overarching objective of this framework is to facilitate access to gas pipelines at prices and on terms and conditions that reflect what would occur in a workably competitive market. The framework, set out in the National Gas (Pipelines Access – Arbitration) Amendment Act 2017 and the National Gas (Pipelines Access - Arbitration) Amendment Rule 2017, came into effect on 1 August 2017.
The Guideline was developed by the AER, in collaboration with the Gas Market Reform Group (GMRG) and the Economic Regulation Authority Western Australia (ERA), with the assistance of leading forensic accounting and insolvency consultants McGrathNicol.
About the AER
The Australian Energy Regulator (AER) works to make all Australian energy consumers better off, now and in the future.
- We regulate electricity networks and covered gas pipelines, in all jurisdictions except Western Australia. We set the amount of revenue that network businesses can recover from customers for using these networks.
- We enforce the laws for the National Electricity Market and spot gas markets in southern and eastern Australia. We monitor and report on the conduct of energy businesses and the effectiveness of competition.
- We protect the interests of household and small business consumers by enforcing the Retail Law. Our retail energy market functions cover New South Wales, South Australia, Tasmania, the ACT and Queensland. We do not set the prices consumers pay.
We drive effective competition where it is feasible and provide effective regulation where it is not. We equip consumers to participate effectively, including through our Energy Made Easy website, and protect those who are unable to safeguard their own interests. We use our expertise to inform debate about Australia’s energy future.