Preliminary Revenue Proposal

ElectraNet’s Preliminary Revenue Proposal (PRP) delivers transmission price reductions, while maintaining network reliability.

The purpose of the PRP is to promote effective early engagement with our customers and other stakeholders and facilitate feedback that we can take into account in our formal revenue proposal, which will be submitted to the Australian Energy Regulator (AER) in March 2017.

This will allow us to further understand customer priorities so that our subsequent formal proposal is based on shared understandings.

We’re leading the industry with our PRP and early engagement program, which aims to promote a more collaborative approach to regulatory decision making.

You might also find these information sheets useful for providing an overview of the PRP, as well as the proposed capital and operating expenditure programs.

We’d like to hear what you think about our PRP:

  • Complete the feedback form
  • Email consultation@electranet.com.au
  • Send your feedback to Simon Appleby, Senior Manager Regulation and Land Management, PO Box 7096, Hutt Street Post Office, ADELAIDE SA 5000
  • Call us on 1800 243 853

ElectraNet’s 2016 annual transmission network stakeholder forum provided an overview of the PRP, Network Vision and the customer engagement program Customer Insights Report, which has helped to shape them. View the presentation to see what was covered.

 

ElectraNet has used reasonable endeavours to ensure that the information contained in the Preliminary Revenue Proposal (PRP) is accurate at the time of writing. It must be noted however that this information contains estimates and projected information calculated based on information and factors that may change including but not limited to key assumptions underpinning the forecasted expenditure. ElectraNet and its officers give no warranties and accept no liability for any loss or damage incurred in reliance on this information. The PRP materials are intended to be used to seek feedback from customers and stakeholders and must be read in conjunction with the full Preliminary Revenue Proposal (PRP) document. The PRP is not an early submission of ElectraNet’s formal revenue proposal to the Australian Energy Regulator.

Revenue Proposal Process Overview

Every five years, ElectraNet submits a Revenue Proposal to the Australian Energy Regulator (AER), which outlines the program of work and forecast revenue required to maintain and operate a safe, reliable and efficient network.

The AER uses a range of evidence to review and assess the Revenue Proposal, including historic trends of past costs, benchmarking against comparable businesses and expert advice. Once the AER has independently reviewed our costs and investment plans it sets the maximum revenue we are allowed to earn for the services we provide. Transmission prices are then set to recover this revenue from customers using a methodology approved by the AER.

We are implementing a program that will help us understand the views and priorities of South Australia’s electricity customers. This information will be reflected in our business plans and Revenue Proposal for the 2019 – 2023 regulatory period, to ensure they meet the long-term needs of customers. More information is available from our Consumer Engagement information sheet.

You might also find these information sheets useful for providing an overview of our Revenue Proposal, as well as the capital and operating expenditure programs.

We’d like to hear what you think about our Revenue Proposal Overview :

  • Email consultation@electranet.com.au
  • Send your feedback marked ‘Revenue Proposal’ to Simon Appleby, Senior Manager Regulation and Land Management, PO Box 7096, Hutt Street Post Office, ADELAIDE SA 5000
  • Call us on 1800 243 853

ElectraNet is committed to genuine engagement with electricity customers. We are using a range of methods to engage with our customers and stakeholders, including our Consumer Advisory Panel.

Read our Customer Engagement Outcomes Report to find out more about how we have incorporated findings and input from our stakeholder engagement into our Revenue Proposal. You can also find out more about the responses we received:

 
 

Framework and Approach

ElectraNet must notify the AER of the need for the Framework & Approach (F&A) process. The notification is to include ElectraNet’s approach to the application of a number of guidelines and schemes for the next regulatory control period.

 

 

Draft F&A published

The AER publishes a position paper on a draft F&A for consultation. This sets out the AER’s proposed approach to the application of the following:

  • Service Target Performance Incentive Scheme
  • Expenditure Efficiency Benefit Sharing Scheme (EBSS) and Capital Expenditure Sharing Scheme (CESS)
  • Expenditure forecast assessment guidelines
  • Whether depreciation will be based on forecast or actual capital expenditure in updating the regulatory asset base
 

Expenditure Forecast Methodology

ElectraNet advises the AER of its approach to forecasting capital and operating expenditure.

Expenditure Forecast Methodology

 

Preliminary Revenue Proposal

ElectraNet releases its Preliminary Revenue Proposal (PRP) which will focus on capital and operating expenditure forecasts, and provide an indicative revenue and price path outlook for the 2019-2023 regulatory period.

 

Consultation on the Preliminary Revenue Proposal

Stakeholders will be invited to provide feedback on the PRP.

 

Revenue Proposal

ElectraNet’s Revenue Proposal (RP) outlines the program of work (capital and operating expenditure forecasts) and forecast revenue required to maintain and operate safe, reliable and efficient network services. The RP must meet the long-term needs of electricity customers.

 

Issues Paper

The AER publishes an Issues Paper in which it identifies early key issues likely to be relevant to its assessment. This includes a ‘first pass’ assessment indicating its preliminary view on ElectraNet’s RP.

 

Public Submissions on Revenue Proposal and Issues Paper

The Revenue Proposal and Issues Paper are published for public consultation.

 

Public Forum

The AER and their Consumer Challenge Panel present the early issues to stakeholders and discuss how they can provide input into the process. ElectraNet is provided the opportunity to give a summary of the RP.

 

Draft Determination

The AER uses a range of evidence to review and assess the RP, including historic cost trends, benchmarking against comparable businesses and expert advice. The Draft Determination (DD) includes the draft total capital and total operating expenditure forecasts, and the draft revenue the AER considers efficient, taking into account stakeholder consultation feedback.

 

Pre-Determination Conference

The AER and the Consumer Challenge Panel present to stakeholders to explain the DD.

 

Public Submissions on DD and Pre-Determination Conference

The DD and Pre-Determination Conference are published for public consultation.

 

Revised Revenue Proposal

ElectraNet’s Revised Revenue Proposal (RRP) sets out revisions made to the RP to incorporate changes arising from the DD made by the AER and comments from stakeholders.

 

Public submission on Revised Revenue Proposal

The Revised Revenue Proposal is published for public consultation.

 

Final Determination

The AER publishes the Final Transmission Determination which contains the maximum allowed revenue (MAR) that ElectraNet may recover from customers through transmission network charges. It also includes the final total capital and operating forecasts the AER considers efficient, taking into account the long term interests of customers.