Regulatory proposal presentation to the AER Public Forum 2021 - 2026 regulatory reset April 2020
Thank you for your interest “We are sorry to not be able to present our Regulatory This presentation provides a summary of our three Proposals for CitiPower, Powercor and United Energy network proposals. Each features network investments in person. to sustain high levels of reliability and safety as well as various initiatives responding directly to customer In these extraordinary times, we are doing all we can to needs, expectations and priorities. support our residential and business customers. Just as maintaining reliable electricity is vital as more Importantly, while our networks are independently rated people work and study from home, providing relief to as the most efficient in the National Electricity Market those experiencing financial stress is an important part (NEM), our proposals also demonstrate how we are of our response. continually working to improve our performance. We are also continuing to undertake critical works and Ultimately, how the COVID-19 experience impacts our maintenance while minimising impacts on customers. five year plans is uncertain. Please be assured we are This will ensure our networks have the capacity to closely monitoring the situation and reviewing forecasts support our communities and economy to recover from and assumptions. We will work with the AER over the this unprecedented emergency. coming months to be flexible to evolving conditions and whatever happens, continue to provide safe, reliable As we present this summary of our proposals for 2021- and affordable electricity to our customers. 2026, we are fully aware that our operating environment has changed enormously since the We look forward to receiving your questions. Our team documents were submitted to the AER in January is ready to respond and open to your feedback.” 2020. Tim Rourke What has not changed is our commitment to deliver Chief Executive Officer more to customers at a lower cost. 2 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
Contents 1 Executive summary 2 Stakeholder engagement 3 Our regulatory submissions CitiPower Powercor United Energy 4 Shared programs 5 Tariff structure 6 Conclusion 3 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
1. Executive summary 4 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
Introduction • Customer and This presentation provides a summary of the regulatory proposals for CitiPower, Powercor and United Energy stakeholder • priorities While it includes an overview of the financial aspects of each proposal, we have put greater emphasis on detailing the initiatives which respond directly to the priorities identified by customers and 1. Electricity stakeholders affordability • You’ll find that while the principles behind each proposal are the same, the focus of investments, innovations and ongoing 2. Network resilience programs is often different Defined as both • This is relevant to the different geography, customer bases, reliable and safe economic drivers, assets or infrastructure, and levels of bushfire risk across our three networks 3. Flexibility • All however, reflect a commitment to delivering meaningful To enable and outcomes for customers accommodate • You’ll find embedded videos throughout this presentation which energy options for provide some more insights into how each proposal is tailored customers • Programs which are common to all three networks have been grouped separately to avoid duplication. 5 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
We face a challenging environment More extreme climatic Peak demand continues to grow conditions are making it despite the increased focus on harder to deliver a safe and energy efficiency and the use of dependable network solar PV Bushfire risk is resulting in: Regulatory change and customer demand are driving the need for • Rapid Earth Fault Current improvement in network Limiter (REFCL) technology visibility and the provision of • insurance cost and capacity data to our customers challenges A heightened level of cyber The historically low risk free rate further reduces the threat underpins the need to capacity of the business to reinforce the systems supporting absorb unfunded costs our network and protect our customers’ data Customers are seeking a more Stricter environmental flexible network that can requirements are resulting in a incorporate new technologies more proactive approach to oil and allow them to export excess and noise management solar electricity 6 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
We respond by focusing on safety, reliability and efficiency • Powercor is Rural networks unplanned minutes off supply Urban networks unplanned minutes off supply Australia’s most (2006-2018 average) (2006-2018 average) reliable rural network—available for over 99.97% of the year • CitiPower is Australia’s most reliable network— available for over 99.99% of the year • United Energy is amongst the most Average operating expenditure Typical residential customer reliable urban productivity (2006 – 2018) distribution charges (2020) networks • Independent benchmarking has our three networks as the most efficient networks in Australia. 7 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
We will continue to deliver affordable services • Our performance will Typical residential distribution Typical small business distribution benefit our customers & metering charges (2021/22) & metering charges (2021/22) through lower network charges 3,024 • Powercor is already delivering the lowest rural network charges in 491 Australia 1,940 415 416 • CitiPower and United 1,658 1,644 Energy are amongst the 331 331 1,407 lowest urban network charges in the NEM. We are offering further reductions over the next regulatory period CitiPower United Jemena Powercor AusNet CitiPower Powercor United Jemena AusNet and remaining the most Energy Energy affordable networks 95% of our customers consider affordability a top priority 8 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
2. Stakeholder engagement How a three year program of deep engagement with a diversity of stakeholders and customers shaped our proposals 9 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
Three year journey involving 11,000 customers and stakeholders • We listened to the needs, priorities and expectations of stakeholders and provided opportunities for their input into our planning: • Customers and their advocates • Interested stakeholders and organisations • Government and various agencies • Customer Consultative Committee • A shared engagement program undertaken by our three businesses between 2017 and 2019 was designed to be accessible, inclusive, transparent and measurable We took our customers on a journey to choose their preferred investments • A dedicated Energy Futures Customer through a ‘citizen led’ approach Advisory Panel oversaw and participated in our whole engagement program. 10 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
Surveys and interviews informed topics for deep dive discussions 20,844 website visits 9,869 9 surveys citizen led deliberative 15 forums focus groups 11,000 customers customer reference panel members with 1,120 interactions 106 19 interviews 34 customer & stakeholder forums 11 20.04.2020 CitiPower, Powercor & United Energy 2021 - 2026 regulatory proposals
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