price direction under draft report, meaning that the particular circumstances. cost allowance for network charges in the ICRC’s The ICRC set out a maximum model has risen by 11 price in the form of a per cent compared with the weighted-average price cap. 2.45 per cent foreshadowed The ICRC calculated two in the draft report. This is maximum average primarily due to increases in percentage changes (or ‘Y transmission costs and the factors’) in standing-offer expected commissioning of prices determined in the ACT’s first large-scale accordance with the solar generator which is model; one with a price supported by a feed-in-tariff on carbon and the other scheme. without. This reflects uncertainty about whether or The without-carbon-price not the carbon tax will be maximum average repealed in 2014-15. For the percentage change in 2014-15 regulatory year, the electricity prices is minus with-carbon-price Y factor is 7.30 per cent in ActewAGL calculated as plus 4.33 per Retail’s basket of regulated cent, and the tariffs compared to 2013-14 Y factor is calculated as prices. This change will minus 7.30 per cent. apply in the event that the Clean Energy Act is The principal change from repealed. While the ICRC the report is the inclusion cannot cannot sure if and ‘be of finalised charges for when the price on carbon will network services, as be removed, this report and approved by the Australian its associated price direction Energy Regulator. These puts in place arrangements to increased more than was ensure that the benefits flow expected at the time of the to ACT electricity customers
price direction under particular circumstances. The ICRC set out a maximum price in the form of a weighted-average price cap. The ICRC calculated two maximum average percentage changes (or ‘Y factors’) in standing-offer prices determined in accordance with the model; one with a price on carbon and the other without. This reflects uncertainty about whether or not the carbon tax will be repealed in 2014-15. For the 2014-15 regulatory year, the with-carbon-price Y factor is calculated as plus 4.33 per cent, and the Y factor is calculated as minus 7.30 per cent. The principal change from the report is the inclusion of finalised charges for network services, as approved by the Australian Energy Regulator. These increased more than was expected at the time of the draft report, meaning that the cost allowance for network charges in the ICRC’s model has risen by 11 per cent compared with the 2.45 per cent foreshadowed in the draft report. This is primarily due to increases in transmission costs and the expected commissioning of the ACT’s first large-scale solar generator which is supported by a feed-in-tariff scheme. The without-carbon-price maximum average percentage change in electricity prices is minus 7.30 per cent in ActewAGL Retail’s basket of regulated tariffs compared to 2013-14 prices. This change will apply in the event that the Clean Energy Act is repealed. While the ICRC cannot cannot ‘be sure if and when the price on carbon will be removed, this report and its associated price direction puts in place arrangements to ensure that the benefits flow to ACT electricity customers
Network%2C%20issue%2051%2C%20June%202014.docx