AER has appointed the consumer reference group for the review of the rate of return guideline

We initiated a review of the rate of return guideline on 31 July 2017 by publishing our consultation paper on the process for reviewing the rate of return guideline. Contributions from consumers are a central part of our process – we recognise that the decisions we make and the actions we take in performing our regulatory roles and other activities affect a wide range of individuals, businesses and organisations.

To this end, we have appointed a consumer reference group (CRG) to assist in the review process.

The role of the CRG is to provide direct and ongoing feedback to the AER during guideline development, and to facilitate broader consumer participation and engagement. We anticipate that CRG members will take up opportunities to work collaboratively, provide submissions on our issues papers and draft decision, and contribute to our workshops and forums.

The CRG is made up of:

• Miyuru Ediriweera, PIAC

• Randal Harkin, COTA Australia

• David Havyatt, Energy Consumers Australia

• David Headberry, MEU

• Mark Henley, Uniting Communities

• Mark Grenning, EUAA

• Heather I’Anson, SA Farmers’ Federation

• Chris Joseph

• Ian McAuley, CARE ACT

• Kym Mercer, Anti-Poverty Network SA

• Brendon Radford, National Seniors

• Robyn Robinson, COTA Australia

We encourage other consumer representatives to contact us at rateofreturnaer [dot] gov [dot] au (rateofreturn[at]aer[dot]gov[dot]au) if you are interested in joining the CRG during the course of the review.

Background

The AER determines the amount of revenue that electricity and gas network businesses can recover from customers for the use of their networks. A key component of this allowed revenue is the ‘rate of return’. This is a forecast of the cost of funds a network business requires to attract investment in its network.

It enables network businesses to obtain necessary funds from capital markets to fund capital investments and service the debt they incur in borrowing the funds. The rate of return makes up approximately 50 per cent of a network business’ allowed revenue. It therefore is a key driver of the amount of network charges that consumers pay.