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Commentary

Electricity network price case in Federal Court

Author

Oliver Derum

 

Hearings commenced today in the Full Federal Court of Australia for the Australian Energy Regulator’s (AER) appeal of a decision overturning its revenue determinations for five energy networks in NSW and the ACT.

PIAC was also today granted leave by the Federal Court to participate in the Federal Court review, with Energy Consumers Australia’s continuing support.

The Commonwealth Minister for Environment and Energy has also been granted leave to make written submissions on the framework issues and what the laws means by the ‘long term interest of consumers’

I spoke to AER Chair Paula Conboy during a break in the hearings to get her take on the case.

 

Background

Energy network costs make up as much as 50% of final energy bills. The level of those costs is determined by the AER, which makes decisions that apply for five years. In April 2015, the AER made its first decisions under its new and enhanced powers. Those decisions were appealed by the five businesses affected, seeking to collect more than $6 billion more from consumers than the AER allowed.

The Public Interest Advocacy Centre also appealed in the Australian Competition Tribunal on behalf of consumers, with significant financial support from ECA.

The Australian Competition Tribunal upheld those appeals, finding the AER had made errors of fact and incorrectly exercised its discretion. The AER is now appealing that decision.

The COAG Energy Council is currently reviewing the law governing how the Competition Tribunal reviews of AER decisions. ECA’s submission to that inquiry can be found here.