2024-29 Regulatory proposal and Tariff Structure Statement
Every five years, we prepare a detailed plan—a regulatory proposal—explaining how we will operate, maintain and invest in the electricity network to meet the future needs of all Canberrans. This electricity five-year plan is submitted to the Australian Energy Regulator (the regulator) for review and approval. The regulator’s decision on our current plan for 2019–20 to 2023–24 can be viewed on the AER website here.
In addition to this, Evoenergy is required to submit a Tariff Structure Statement. A Tariff Structure Statement provides customers with information about current network tariffs and how these may change in the future. Australia’s National Electricity Rules require all electricity network businesses to publish a Tariff Structure Statement. Our current Tariff Structure Statement forms the basis of network charges in the 2019–20 to 2023–24 regulatory period.
Our current plan and Tariff Structure Statement will expire on 30 June 2024. Our proposal for how we operate and invest in the electricity network in 2024–29 was submitted to the Australian Energy Regulator (AER) on 31 January 2023.
Figure 1. Regulatory timeframe
Figure 2. Evoenergy energy delivery chain
What is in our five-year plan?
Our five year plan covers many aspects and details of how we propose to operate and invest in the electricity network, and a central element of the plan is our estimate of the lowest sustainable cost of managing the electricity network in the ACT. This estimate needs to take into account expected growth in demand for electricity and electricity network connections in the coming five years, as well as managing the network in a way that ensures a quality, reliable, secure and safe electricity supply.
Pathway towards net zero
Alternative electricity generation
Pricing structures (including tariff options)
The Regulator reviews our plan and conducts its own analysis to determine whether the proposed cost of providing electricity distribution services is prudent and efficient. prudent and efficient.
Efficient expenditure results in the lowest cost to consumers over the long term.
The Regulator considers the following factors when making its determination on efficient costs:
Forecast consumption and demand
Framework and Approach
The Framework and Approach is the first step in the regulatory review – it establishes the scope and framework of the regulatory review. During the Framework and Approach process, the regulator decides which services it will regulate (service classification), and how it controls the prices we charge and/or revenue we collect for offering these services (control mechanisms). The Framework and Approach process also reveals the regulator’s initial positions on the broad nature of the regulatory arrangements including incentive schemes, transmission assets and depreciation of regulatory assets among others.
As part of the preparation of the 2024-29 regulatory proposal, Evoenergy submitted a request to the regulator with respect to the Framework and Approach on 31 October 2021 and the AER published its response in the form of a Framework and Approach paper to guide Evoenergy’s 2024–29 regulatory proposal on 31 July 2022.
Tariff Structure Statement
Each regulatory period, distributors submit a tariff structure statement (TSS) to the regulator for approval. The TSS provides customers and the community with clear information about current network tariffs and how these may change in the future.
Evoenergy’s TSS structure will determined by a number of factors including:
- the expected impact on customers; and
- consumer engagement and understanding.
Evoenergy’s network is facing considerable changes that may have an impact on the way network tariffs are structured in the next regulatory period. These include impacts from solar generation, electric vehicle and residential battery uptake, the introduction of grid-scale batteries to the network and the ACT Government’s target of net zero emissions by 2045.
With the changing landscape of the energy market, we need to consider whether changes to the current tariff structure are required, and if so, what these changes mean for customers.