Consumers will benefit from the Australian Energy Regulator’s (AER) remade draft decision on the amount of revenue that Endeavour Energy is entitled recover over the 2014-19 regulatory period (1 July 2014 to 30 June 2019).
“We are satisfied this decision is in the long-term interests of consumers and will promote price stability at a time where affordability is a key concern for many consumers,” said AER Chair Paula Conboy.
The remade draft decision means Endeavour Energy would be able to recover total revenues of $4.1 billion from its customers over the five‑year regulatory period. Endeavour Energy proposed this figure and the AER accepted it. A final decision is due in October.
The remaking of the determination follows the end of limited merits and judicial review processes in May 2017 arising from the AER’s 2015 final decision.
In 2015, Endeavour Energy proposed to recover $5.4 billion from consumers over the 2014-19 regulatory period, but the AER did not accept this amount in its determination and legal action followed. Key elements of the disputed determination included claims of $264 million for operating expenditure and $227 million in return on debt.
Ms. Conboy welcomed the collaborative approach taken by Endeavour Energy in developing its proposal.
“Endeavour Energy consulted closely with consumers. Several consumer groups have indicated their support for Endeavour Energy’s initiative and collaborative approach in formalising its proposal.
“This outcome is an excellent example of how engaging with consumers in a revenue setting process can benefit everyone. This is the type of approach the AER is keen to model with network businesses to drive a more efficient reset process across the National Energy Market,” said Ms Conboy.
The AER welcomes further comment from consumers and other interested stakeholders as it moves toward making a final decision later this year. Stakeholders are invited to make written submissions on the draft decision by 17 August.
Under a separate determination process, the AER is in the early stages of considering Endeavour Energy’s revenue proposal for the next regulatory period, 2019‑24.