We are calling for submissions on AusNet Services’ cost pass through application relating to distribution network costs incurred due to a storm event in Victoria on 2 September 2024. The storm resulted in approximately 180,000 customers being off supply.
AusNet Services incurred $18.7 million ($2021) in incremental costs (capital and operating expenditure), including $6 million in Guaranteed Service Level payments to affected customers, and $12.6 million for emergency response. This results in a proposed increase to its revenue allowance of $11.4 million ($2021, smoothed). AusNet Services has proposed to recover half of this amount ($5.7 million) in 2025–26, and the remainder ($5.7 million) in the first year of the 2026–31 regulatory period.
This approach would result in an increase in residential customer bills in 2025–26 of approximately $7.
We invite stakeholder submissions on AusNet Services' cost pass through application by 25 February 2025. Please refer to the AusNet Services’ storm cost pass though application webpage for instructions on how to make submissions.
Background
A cost pass through application allows network businesses to recover efficient costs, not accounted for in current revenue determinations, associated with natural disasters such as severe storms.
AusNet Services is required to make Guaranteed Service Level payments to customers where certain levels of service are not met in accordance with the Electricity Distribution Code of Practice and the conditions of its distribution licence. These payments can be recovered under the cost pass through framework as they are a regulatory obligation on AusNet Services.
Our role
Under the National Electricity Rules, the AER is required to assess cost pass through applications from network businesses, including in relation to natural disaster events. In making this assessment, the AER uses the principle that consumers should pay no more than necessary for safe and reliable energy.