Powercor’s revised proposal. We are satisfied that this amount reasonably reflects the capex criteria. Powercor's revised proposal forecast of $672 million for repex is 7 percent lower than the $722 million in its initial proposal. Table 1 summarises Powercor's proposals and our alternative amounts for repex at each stage of the assessment period. 1: Final decision on Powercor's total forecast repex ($2015, million) 2016 2017 2018 2019 2020 Total Initial regulatory proposal 131 129 145 151 166 722 AER preliminary decision 111 109 122 127 140 609 Revised regulatory proposal 120 126 134 142 151 672 AER final decision 109 114 121 128 137 609 Total difference b/w final and -12 -12 -13 -13 -14 -64 revised Percentage difference b/w final -10 -10 -9 -10 -9 -10 and revised (%) Source: AER analysis. Note: Numbers may not add up due to rounding. Powercor’s revised proposal In its revised proposal Powercor accepted the following parts of our preliminary decision: assessed using the repex model for all modelled asset categories except for the overhead conductors group, and one asset category in switchgear un-modelled repex for pole top structures, SCADA and "other". The issues Powercor raised in revised proposal that it did not accept from our preliminary decision were: Powercor considered its proactive overhead conductor replacement program warranted a forecast higher than the business as usual amount predicted by the repex model. Powercor was of the view that there was a modelling error relating to the switchgear category, high voltage (HV) fuses and surge protectors. It submitted its correction to the repex model increasing its forecast by approximately $9 million. Powercor submitted its forecast for the overhead conductor categories in the repex model included:
Powercor’s revised proposal. We are satisfied that this amount reasonably reflects the capex criteria. Powercor's revised proposal forecast of $672 million for repex is 7 percent lower than the $722 million in its initial proposal. Table 1 summarises Powercor's proposals and our alternative amounts for repex at each stage of the assessment period. 1: Final decision on Powercor's total forecast repex ($2015, million) 2016 2017 2018 2019 2020 Total Initial regulatory proposal 131 129 145 151 166 722 AER preliminary decision 111 109 122 127 140 609 Revised regulatory proposal 120 126 134 142 151 672 AER final decision 109 114 121 128 137 609 Total difference b/w final and revised -12 -12 -13 -13 -14 -64 Percentage difference b/w final and revised (%) -10 -10 -9 -10 -9 -10 Source: AER analysis. Note: Numbers may not add up due to rounding. Powercor’s revised proposal In its revised proposal Powercor accepted the following parts of our preliminary decision: assessed using the repex model for all modelled asset categories except for the overhead conductors group, and one asset category in switchgear un-modelled repex for pole top structures, SCADA and "other". The issues Powercor raised in revised proposal that it did not accept from our preliminary decision were: Powercor considered its proactive overhead conductor replacement program warranted a forecast higher than the business as usual amount predicted by the repex model. Powercor was of the view that there was a modelling error relating to the switchgear category, high voltage (HV) fuses and surge protectors. It submitted its correction to the repex model increasing its forecast by approximately $9 million. Powercor submitted its forecast for the overhead conductor categories in the repex model included:
AER%20-%20Final%20decision%20Powercor%20distribution%20determination%20-%20Attachment%206%20-%20Capital%20expenditure%20-%20May%202016.DOCX