Capital Expenditure Sharing Scheme combination with the CESS as this will maintain the incentive for ActewAGL to pursue capex efficiencies. Demand Management Incentive Scheme Dual function assets Expenditure Forecast Assessment Guideline Some high voltage distribution assets are of use to customers outside of the distribution network. These are dual function Our Expenditure Forecast Assessment Guideline is based on a assets that support the transmission of electricity at high reporting framework allowing us to compare the relative voltages across Australia and not just within a distribution efficiencies of distributors. Our preliminary position is to apply network. One aspect of our decision is to determine whether the guideline, including its information requirements, to customers within the network should pay for these assets or ActewAGL in the upcoming regulatory control period. whether the costs should be recovered from only those Our expenditure assessment guideline outlines a suite of customers that benefit from their use. assessment/analytical tools and techniques to assist our ActewAGL has submitted that it does operate dual function review of ActewAGL’s regulatory proposal. We intend to apply assets. Our preliminary position is to apply transmission the assessment/analytical tools set out in the guideline and pricing rules to 6 per cent of ActewAGL’s RAB, consistent with any other appropriate tools for assessing expenditure the current regulatory control period. ActewAGL submitted forecasts. that the value of its dual function assets is now 19 per cent of Depreciation its RAB. We are engaging with ActewAGL to understand the We provide an allowance for network businesses to reasons for this reported increase in the value of its dual recover the costs of their investments. The rate at function assets. We will reflect this further engagement in our which they recover the cost of their investments is final F&A. determined by their depreciation profile. We have a For more information: choice of using forecast or actual depreciation. We have chosen to apply forecast depreciation in More information can be found on our website: .
Capital Expenditure Sharing Scheme Demand Management Incentive Scheme Expenditure Forecast Assessment Guideline Our Expenditure Forecast Assessment Guideline is based on a reporting framework allowing us to compare the relative efficiencies of distributors. Our preliminary position is to apply the guideline, including its information requirements, to ActewAGL in the upcoming regulatory control period. Our expenditure assessment guideline outlines a suite of assessment/analytical tools and techniques to assist our review of ActewAGL’s regulatory proposal. We intend to apply the assessment/analytical tools set out in the guideline and any other appropriate tools for assessing expenditure forecasts. Depreciation We provide an allowance for network businesses to recover the costs of their investments. The rate at which they recover the cost of their investments is determined by their depreciation profile. We have a choice of using forecast or actual depreciation. We have chosen to apply forecast depreciation in combination with the CESS as this will maintain the incentive for ActewAGL to pursue capex efficiencies. Dual function assets Some high voltage distribution assets are of use to customers outside of the distribution network. These are dual function assets that support the transmission of electricity at high voltages across Australia and not just within a distribution network. One aspect of our decision is to determine whether customers within the network should pay for these assets or whether the costs should be recovered from only those customers that benefit from their use. ActewAGL has submitted that it does operate dual function assets. Our preliminary position is to apply transmission pricing rules to 6 per cent of ActewAGL’s RAB, consistent with the current regulatory control period. ActewAGL submitted that the value of its dual function assets is now 19 per cent of its RAB. We are engaging with ActewAGL to understand the reasons for this reported increase in the value of its dual function assets. We will reflect this further engagement in our final F&A. For more information: More information can be found on our website: .
AER%20-%20Fact%20sheet%20for%20Preliminary%20framework%20and%20approach%20for%20ActewAGL%202019-24%20-%20March%202017.DOCX