Application by AusNet Electricity Services Pty Ltd - [2017] ACompT 3

AUSTRALIAN COMPETITION TRIBUNAL
Application by AusNet Electricity Services Pty Ltd [2017] ACompT 3

Review from: Australian Energy Regulator Final Decision: AusNet Services distribution determination 2016 to 2020

File number:

ACT 8 of 2016

Tribunal

ROBERTSON J (DEPUTY PRESIDENT)

MR RF SHOGREN (MEMBER)

DR DR ABRAHAM (MEMBER)

Date of Determination:

17 October 2017

Catchwords:

ENERGY AND RESOURCES – application under s 71B of the National Electricity Law for review of distribution determination by the Australian Energy Regulator (AER) –whether reviewable error on the part of the AER – topics for review – return on debt: Bloomberg Valuation Service (BVAL) curve – forecasting opex: self-insurance

Legislation:

National Electricity Law

National Electricity Rules

Cases cited:

Application by ActewAGL Distribution [2010] ACompT 4

Application by ActewAGL Distribution [2017] ACompT 2

Application by APT Allgas Energy Limited (No 2) [2012] ACompT 5

Application by Envestra Limited (No 2) [2012] ACompT 4

Application by Jemena Gas Networks (NSW) Ltd (No 5) [2011] ACompT 10

Application by Jemena Gas Networks (NSW) Ltd [2016] ACompT 5

Applications by Public Interest Advocacy Centre Ltd and Ausgrid [2016] ACompT 1

Australian Competition and Consumer Commission v Australian Competition Tribunal [2006] FCAFC 83; 152 FCR 33

Australian Energy Regulator v Australian Competition Tribunal (No 2) [2017] FCAFC 79; 345 ALR 1

Dates of hearing:

14-18, 21-25 November 2016

Date of last submissions:

21 July 2017

Dates of Community Consultation:

6 and 7 October 2016

Registry:

Victoria

Category:

Catchwords

Number of paragraphs:

173

Counsel for AusNet Electricity Services Pty Ltd:

Mr PJ Bick QC with Mr AJ Weinstock

Solicitor for AusNet Electricity Services Pty Ltd:

Jones Day

Counsel for the Australian Energy Regulator:

Mr MH O’Bryan QC with Ms KL Walker QC, Mr J Arnott and Mr T Clarke

Solicitor for the Australian Energy Regulator:

Australian Government Solicitor

Counsel for the Minister for Energy, Environment and Climate Change for the State of Victoria, Intervener:

Mr SR Horgan QC with Mr GR McCormick

Solicitor for the Minister for Energy, Environment and Climate Change for the State of Victoria, Intervener:

Allens

IN THE AUSTRALIAN COMPETITION TRIBUNAL

ACT 8 of 2016

RE:
IN THE MATTER OF APPLICATION UNDER SECTION 71B OF THE NATIONAL ELECTRICITY LAW FOR A REVIEW OF A DISTRIBUTION DETERMINATION MADE BY THE AUSTRALIAN ENERGY REGULATOR IN RELATION TO AUSNET ELECTRICITY SERVICES PTY LTD PURSUANT TO CLAUSES 6.11.1 AND 11.60.4 OF THE NATIONAL ELECTRICITY RULES

BY:
AUSNET ELECTRICITY SERVICES PTY LTD (ACN 064 651 118)
Applicant

TRIBUNAL:

ROBERTSON J (DEPUTY PRESIDENT)
MR RF SHOGREN (MEMBER)
DR DR ABRAHAM (MEMBER)

DATE OF
DETERMINATION:
17 OCTOBER 2017
THE TRIBUNAL DETERMINES THAT:
1.The reviewable regulatory decision, being the Final Decision AusNet Services distribution determination 2016 to 2020, is affirmed.

THE TRIBUNAL NOTES: the AER’s error in calculation identified at [376] of its reasons in Application by ActewAGL Distribution [2017] ACompT 2 and, in accordance with [377] of those reasons, leaves it to the AER to determine the appropriate response to its error.

REASONS FOR DETERMINATION
THE TRIBUNAL:

INTRODUCTION

[1]

THE STATUTORY…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Application by AusNet Electricity Services Pty Ltd

Details

AGLC: Application by AusNet Electricity Services Pty Ltd [2017] ACompT 3
Case: [2017] ACompT 3
Decision Date: 17 October 2017

CaseChat Overview and Summary

AusNet Electricity Services Pty Ltd (AusNet) applied to the Federal Court of Australia for review of a determination by the Australian Energy Regulator (AER) under section 71B of the National Electricity Law. The application contested the AER's determination regarding the return on debt and forecasting of operating expenses. The Federal Court was required to decide whether the AER's determination contained any reviewable error.

The court considered whether the AER's decision to use the Bloomberg Valuation Service (BVAL) curve for determining the return on debt contained any reviewable error. The court also assessed whether the AER's approach to forecasting operating expenses, specifically in relation to self-insurance, contained any reviewable error. The court examined the AER's application of the relevant statutory provisions and its reasoning in light of the evidence before it.

The court found that the AER's decision to use the BVAL curve for determining the return on debt was reasonable, and that the AER's approach to forecasting operating expenses, including self-insurance, was also reasonable. The court concluded that there was no reviewable error in the AER's determination. Consequently, the court dismissed AusNet's application for review.

Orders