PROJECTS

ELECTRICITY SUPPLY

  • Preparation of economic benchmarking results for the Australian Energy Regulator's Annual Benchmarking Reports. Our latest reports include analyses identifying the drivers of productivity change for each network business. Click here to see our report on electricity distribution businesses. Click here to see our report on electricity transmission businesses.
  • Advice to the Australian Energy Regulator on the output weights used in calculating the output growth rate in the base/step/trend method used to assess network service providers' operating expenditure proposals. Click here to see our review of a report submitted by South Australian Power Networks.
  • Advice to the Australian Energy Regulator on the forecast productivity growth rate to be included in the base/step/trend method used to assess network service providers' operating expenditure proposals. Click here to see our advice on selected issues raised in submissions on the AER's Draft Report. Click here to see our analysis of the appropriate way to include allowance for ongoing undergrounding in electricity distribution opex cost function models.
  • Advice to the Netherlands' Authority for Consumers and Markets on the use of data envelopment analysis (DEA) in energy network regulation. Our reports examined relevant issues for consideration in developing candidate variables to include in benchmarking studies of gas and electricity transmission system operators, in calculating capital costs, in choosing a preferred benchmarking model and in explaining and evaluating the results of the DEA benchmarking analysis.
  • Review of electricity transmission benchmarking for the Australian Energy Regulator. Click here to see our report which recommended a number of changes to the specification of outputs used in transmission benchmarking.
  • Economic benchmarking of the efficiency of NSW and ACT electricity distribution businesses' operating expenditure for the Australian Energy Regulator. The analysis applied a number of econometric cost function and index number models to assess efficiency. The econometric models included data from electricity distribution businesses in Australia, New Zealand and the Canadian province of Ontario. Click here to see our report to the AER. Click here to see our report responding to stakeholders' consultants' reports.
  • Economic benchmarking of the NSW and Tasmanian electricity transmission businesses' operating expenditure for the Australian Energy Regulator. The analysis applied index number models to form recommendations for the productivity change to be applied to forecast opex for the five-year regulatory period commencing on 1 July 2014. Click here to see our report to the AER.
  • Developed options for the Essential Services Commission Victoria (ESC) for the 2015 and 2016 minimum feed-in tariffs (FiTs) for Victorian small renewable electricity generators. In 2014 we prepared a report reviewing and refining the methodology for calculating the FiT and developed a model for calculating the FiT with and without the Commonwealth carbon pricing scheme. In 2015, we reviewed international and Australian FiT schemes, examined methodological issues relating to the calculation and design of FiTs and quantified 2016 FiTs under various scenarios.
  • Advised the New Zealand Commerce Commission on the long-run productivity growth rate used to set the X factor for the electricity distribution industry's 2015-2020 default price-quality path and on the opex partial productivity growth rate used in the Commission's high level building blocks model. Click here to see our final report. Click here to see our report responding to stakeholders' submissions.
  • Investigation of the characteristics of energy retail customers remaining on regulated or standing offers in NSW, Queensland and Victoria for the AEMC.
  • Provision of advice to the Australian Energy Regulator on the economic benchmarking of electricity distribution network service providers (DNSPs) and electricity transmission network service providers (TNSPs). This involved running a series of six consultation workshops with stakeholders and included advice on the potential role of economic benchmarking in future regulatory determinations and regulatory reporting. Click here to view Economic Insight's report for the AER on economic benchmarking.
  • Analysis of capital expenditure incentives for the Australian Energy Market Commission as part of its Economic Regulation of Network Service Providers Rule Change determination. Click here to view our report on the use of actual versus forecast depreciation in rolling forward the regulatory asset base between regulatory periods.
  • Construction of a detailed model of economic regulation for the Australian Energy Market Commission. The model compares outcomes under the building block approach with those under productivity-based regulation for a range of scenarios. Click here to view our report on the modelís construction, use and results.
  • Advice to the Australian Energy Market Commission on index specification issues for the use of total factor productivity (TFP) in energy network regulation. Click here to view our report on the current state of knowledge on the specification of energy network TFP growth and areas where further work needs to be done.
  • Advice to the New Zealand Commerce Commission on setting the Default Price Path X factor for electricity distribution businesses. Click here to view our report on the productivity performance of electricity distribution taking account of sunk costs and financial capital maintenance.
  • Preparation of reports for the New Zealand Commerce Commission on productivity-based regulation taking account of sunk costs and financial capital maintenance. These reports represent a significant advance in the theory of network regulation. Despite the importance of both sunk costs and financial capital maintenance to network regulation, neither had been allowed for in previous applications of productivity-based regulation. Click here to view our technical report on the theory of productivity-based regulation. Click here to view our report on asset valuation methods and productivity-based regulation.
  • Expert advice to the Australian Energy Market Commission on the design and application of a total factor productivity (TFP) based methodology for energy network regulation. Click here to view our report for the AEMC on energy network TFP sensitivity analysis.
  • Advice to the Australian Energy Market Commission on whether currently available data and regulatory reporting requirements were sufficiently robust to support the implementation of a total factor productivity (TFP) based regulation methodology for the electricity and gas distribution and transmission industries. Click here to view our report for the AEMC on assessment of data currently available to support TFP-based network regulation.
  • Expert advice to the New Zealand Commerce Commission relating to regulatory economic principles, guidelines and the regulatory regimes for electricity lines businesses, gas pipelines businesses and other regulated businesses.
  • The form of price control for regulation of prices in the electricity distribution and retail sector in New South Wales for Energy Australia for an IPART price review.
  • The regulation framework for the electricity industry in Queensland for the Queensland Competition Authority.
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