Envestra's proposed forecast capex and depreciation. See overview sections 5 and 7 and attachments 3 and 5 for more on the AER's draft decision on these matters. These adjustments result in a $6.6 million and $0.6 million reductions to Envestra's proposed opening capital bases at 1 January 2013 for its Victoria and Albury networks respectively. The AER's draft decision is for opening capital bases of $1109.7 million and $34.6 million ($nominal) as at 1 January 2013 for Envestra's Victoria and Albury networks respectively. Based on these, and the AER's draft decisions on forecast capex, depreciation, and inflation, the AER has determined projected closing capital bases as at 31 December 2017 of $1375.1 million and $37.1 million ($nominal) for Envestra's Victoria and Albury networks respectively. The AER also does not approve Envestra's proposal to use actual depreciation rather than forecast depreciation to establish its opening capital bases as at 1 January 2018. The AER considers the use of forecast depreciation (approved in the final decision for this access arrangement review) to roll forward the capital base from 2013–17 at the next access arrangement review is a preferable alternative that complies with the requirements of the NGO and the revenue and pricing principles. See attachment 2 for more on the AER's draft decision on the capital bases and reasons for this.
Envestra's proposed forecast capex and depreciation. See overview sections 5 and 7 and attachments 3 and 5 for more on the AER's draft decision on these matters. These adjustments result in a $6.6 million and $0.6 million reductions to Envestra's proposed opening capital bases at 1 January 2013 for its Victoria and Albury networks respectively. The AER's draft decision is for opening capital bases of $1109.7 million and $34.6 million ($nominal) as at 1 January 2013 for Envestra's Victoria and Albury networks respectively. Based on these, and the AER's draft decisions on forecast capex, depreciation, and inflation, the AER has determined projected closing capital bases as at 31 December 2017 of $1375.1 million and $37.1 million ($nominal) for Envestra's Victoria and Albury networks respectively. The AER also does not approve Envestra's proposal to use actual depreciation rather than forecast depreciation to establish its opening capital bases as at 1 January 2018. The AER considers the use of forecast depreciation (approved in the final decision for this access arrangement review) to roll forward the capital base from 2013–17 at the next access arrangement review is a preferable alternative that complies with the requirements of the NGO and the revenue and pricing principles. See attachment 2 for more on the AER's draft decision on the capital bases and reasons for this.
Envestra%20draft%20decision%20-%20Part%201.docx