AER announces draft decision on rate of return guide

THE Australian Energy Regulator has released a draft decision on its Rate of Return Guideline, stating the review was the ‘most extensive consultation process yet.’

AER announces draft decision  on rate of return guide AER announces draft decision  on rate of return guide AER announces draft decision  on rate of return guide AER announces draft decision  on rate of return guide AER announces draft decision  on rate of return guide
The forecast will slash the amount that debt energy networks will be able to claim for infrastructure development like poles and wires and will reduce the overall rate of return for network businesses by 13%, compared to the 2013 rate. 
 
According to the peak body of energy networks Energy Networks Australia, this would equate to an estimated $2 billion increase in costs for the companies over five years. 
 AER chair Paula Conboy was quick to justify the decision and cited a need for balance. 
 
"If the rate of return is too high, over-investment could follow and customers would pay more," Conboy said, "If it is too low insufficient investment may result, risking reliability."
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