The Australian Energy Regulator has released its annual benchmarking reports for electricity distribution and transmission. These reports show the productivity of most electricity network businesses improved in 2015.
The benchmarking reports compare the productivity of network businesses and track changes over time.
The AER’s benchmarking analysis shows that most network businesses have improved their productivity. Distribution networks in the ACT, South Australia, Tasmania and Victoria have all improved their productivity, while the transmission networks in South Australia and Tasmania have also improved.
“Our benchmarking reports show differences in the productivity of the distribution businesses. Generally the Victorian and South Australian businesses are the most productive. Comparatively, the NSW, ACT and Queensland businesses do not perform as well,” AER Board Member, Jim Cox said.
“Our benchmarking work indicates the NSW and Queensland distributors are not performing as efficiently as they could be. We understand some of the NSW and Queensland businesses are undergoing reforms, leading to increased costs in the short term,” Mr Cox said.
“These reforms should contribute to improved productivity in the future, for the NSW and Queensland networks,” he added.
Tasmanian network productivity has also improved.
“We are encouraged to see an improvement in the productivity of TasNetworks, achieved through the merger of their transmission and distribution businesses in 2014,” Mr Cox said.
The overall benchmarking measures are part of the suite of tools the AER uses to assess the efficiency of network businesses, and form part of the ongoing process of refining the regulatory approach.
“The benchmarking work is critical in helping us determine the amount of money network businesses can recoup from customers, via network charges, through their energy bills,” Mr Cox said.
“It is our role to ensure businesses operate efficiently, meaning consumers pay no more than necessary for their electricity needs.” he added.
“The benchmarking reports provide more transparency about the productivity of network businesses than ever,” AER Board Member Jim Cox said.
About the AER
The Australian Energy Regulator regulates energy markets and networks under national legislation and rules in eastern and southern Australia, as well as networks in the Northern Territory. Its functions include:
- monitoring wholesale electricity and gas markets to ensure energy businesses comply with the legislation and rules, and taking enforcement action where necessary;
- setting the amount of revenue that network businesses can recover from customers for using networks (electricity poles and wires and gas pipelines) that transport energy;
- regulating retail energy markets in Queensland, New South Wales, South Australia, Tasmania (electricity only), and the ACT;
- operating the Energy Made Easy website, which provides a retail price comparator and other information for energy consumers;
- publishing information on energy markets, including the annual State of the energy market report, to assist participants and the wider community.