Australian Energy Regulator’s Draft Determination welcomed

Key points

• The Australian Energy Regulator (AER) has issued its Draft Determination on Endeavour Energy’s Revenue Proposal for 1 July 2024 to 30 June 2029 (2024-29 period).
• The AER accepts Endeavour Energy’s proposed forecasts for total capital and operating expenditure and recovery of overall revenue from customers with minimal amendment.
• The AER advises its Draft Determination is based on the premise that consumers should pay no more than necessary for safe and reliable energy while supporting an equitable energy transition.

SYDNEY 28 September 2023: Endeavour Energy has welcomed the Australian Energy Regulator’s Draft Determination for the 2024-2029 regulatory period.

At a challenging time for energy consumers and the sector more broadly, the Draft Determination recognises Endeavour Energy’s focus on balancing dependability, value for money and efficient investments to serve customers’ long-term choices and interests.

In releasing its Draft Determination, the AER said Endeavour Energy had engaged authentically and constructively with them, and with customers and stakeholders, stating:

“Endeavour has provided a high-quality proposal, which it developed through an extensive, genuine, and high-quality engagement process. Endeavour has also engaged constructively with us through information requests to allow us to better understand the drivers of its proposal and to close gaps in its supporting information. We have accepted much of Endeavour’s proposal, including its total capex and opex forecasts.”

Endeavour Energy’s Chief Executive Officer Guy Chalkley, said: “We undertook our most comprehensive engagement program ever to develop our Proposal.

“It focuses on value for money with an increased emphasis on our customers’ emerging priorities of innovation and resilience, balancing affordability with investments that deliver the reliable, resilient, and modern energy service our customers have told us they want.

“The AER has acknowledged we worked through an extensive and genuine engagement process to keep our costs stable by tightly managing what we can control and keeping our part of customer bills as low as possible.”

Mr Chalkley said this approach is reflected in the AER’s Draft Determination, which forecasts an annual average price increase in our distribution services of $24* for a typical residential customer and $43* for small-medium businesses (*inclusive of forecast inflation).

“While affordability has been our focus, we know that the energy transition provides both significant challenges and opportunities for our customers and for the community.

“We’ve aimed to strike the best possible balance between dependability, value for money and efficient investment that serve our customers’ long-term choices and interests.

Mr Chalkley said the AER had commended Endeavour Energy on the “significant step-up taken in relation to its stakeholders on issues such as public lighting” and “its engagement approach to deliver outcomes valued by its stakeholders.”

The AER also observed “broad and deep engagement with customers and stakeholders across the reset process that has genuinely influenced the proposal through a co-design process” and noted that “Endeavour’s consumer engagement has been a material factor in our decision to accept most of Endeavour’s proposal.”

Mr Chalkley said engagement had delivered outcomes that customers most value - improving network resilience and modern technologies enabling them to participate affordably in the clean energy transition.

“The result is a measured and affordable proposal that our customers and customer advocates have supported.”

Customers can review the AER’s Draft Determination here and provide further feedback to the AER by 19 January 2024 at AERresets2024-29@aer.gov.au.

Background

• Regulated network businesses like Endeavour Energy must periodically apply to the AER to determine the maximum allowed revenue it can recover from consumers for using its network.
• On 31 January 2023 Endeavour Energy submitted a draft revenue proposal for the period 1 July 2024 to June 2029 (2024-29 period) which was co-designed after 18 months of engagement with customers, listening to their needs and priorities.
• The draft proposal outlines plans to deliver power supply to customers over the coming five years, including investments in building and maintaining the network, customer service and proposed tariffs.
• Our objective has been to strike the best  balance between dependability, value for money and efficient investments in innovation to serve customers’ long-term choices and interests.

For media enquiries contact Endeavour Energy on 0409 664 608

About Endeavour Energy

Endeavour Energy is one of Australia’s best performing electricity distributors, powering Australia’s third largest economy and sustaining jobs and lifestyles of 2.7 million Australians. We’re supporting unprecedented growth in our network, with Western Sydney expected to be 40% higher than in the rest of Sydney as international data centres flood into the area.

We are rapidly transitioning from a traditional network business to one known for its innovative, customer-centred approach to lighting homes and streets, powering businesses, keeping communities safe, driving economic growth and facilitating the rapid adoption of clean energy.

Endeavour Energy’s network spans more than 25,000 sq km and includes communities in the Blue Mountains to Greater Western Sydney, Southern Highlands, Illawarra and South Coast of NSW. These regions are regularly affected by the impacts of climate change, including some of the worst floods and bushfires in Australia in recent years.

Our critical electricity infrastructure includes more than 430,000 power poles and streetlight columns, 207 major substations and 32,600 distribution substations connected by nearly 60,600 kilometres of underground and overhead cables which are integrated with renewable energy sources, including 220,000 residential solar connections, industrial solar and large-scale batteries.