Electricity Supply Industry (Price Control) Amendment Regulations 2006

Electricity Supply Industry (Price Control) Amendment Regulations 2006

I, the Governor in and over the State of Tasmania and its Dependencies in the Commonwealth of Australia, acting with the advice of the Executive Council, make the following regulations under the Electricity Supply Industry Act 1995 .

3 July 2006

W. J. E. COX

Governor

By His Excellency's Command,

MICHAEL AIRD

Treasurer

1.   Short title

These regulations may be cited as the Electricity Supply Industry (Price Control) Amendment Regulations 2006 .

2.   Commencement

These regulations take effect on the day on which their making is notified in the Gazette.

3.   Principal Regulations

In these regulations, the Electricity Supply Industry (Price Control) Regulations 2003 are referred to as the Principal Regulations.

4.    Part 3A inserted

After regulation 37 of the Principal Regulations , the following Part is inserted:

PART 3A - 2007 Retail Price Determination

37A.   Interpretation

In this Part –

2003 declared electrical service price determination means the declared electrical service price determination –

(a) made in respect of the following declared electrical services:

(i) electricity retailing to tariff customers on mainland Tasmania;

(ii) electricity distribution on mainland Tasmania; and

(b) issued on 27 November 2003;

2007 retail price determination means the determination made by the Regulator under regulation 37C ;

cost to serve means the costs of providing retail services to tariff customers calculated by adjusting $76.67 by the Consumer Price Index for the period 30 June 2003 to 30 June 2006;

determination period means the 12-month period starting on 1 January 2007;

Hydro Tasmania means the Hydro-Electric Corporation continued under the Hydro-Electric Corporation Act 1995 ;

notional tariff base means the customers that are eligible for the supply of electricity under the tariffs listed in Schedule 1 regardless of whether those customers are supplied electricity under those tariffs;

retail margin means a margin of 3% on all costs attributable to the provision of electricity to the notional tariff base that is to be included in the retail price of electricity;

retail supply for tariff customers means the sale of electricity to the notional tariff base.

37B.   Interaction with Part 3

The Regulator, in respect of the declared electrical service that is electricity retailing to tariff customers on mainland Tasmania –

(a) is not required to make a declared electrical service price determination that relates to the determination period; and

(b) is not required before the expiration of the 2003 declared electrical service price determination to conduct an investigation under Division 2 of Part 3 or to determine under regulation 23 whether or not the declaration of that declared electrical service should be revoked.

37C.   2007 retail price determination

(1)  The Regulator is to make a determination that regulates the prices that may be charged by, and specifies the price control mechanisms imposed on, an electricity entity during the determination period in respect of the declared electrical service that is electricity retailing to tariff customers on mainland Tasmania.

(2)  In making the 2007 retail price determination, the Regulator is to give effect to the following principles:

(a) the price for energy in the determination period is equal to the fixed price for electricity, within the meaning of the relevant vesting agreement, as at 1 January 2007;

(b) the determination is to allow for an adjustment, as a result of a tax event, to the prices that may be charged by, and the price control mechanisms imposed on, an electricity entity under the determination;

(c) the determination is to allow for an adjustment, to the prices that may be charged by, and the price control mechanisms imposed on, an electricity entity under the determination, as a result of a change in the costs to the electricity entity from the purchase of renewable energy certificates, within the meaning of the Renewable Energy (Electricity) Act 2000 of the Commonwealth;

(d) the determination is to allow for any charges by NEMMCO that are attributable to providing services to the notional tariff base, as calculated in accordance with a methodology approved by the Regulator;

(e) the determination is to allow for the cost of relevant distribution and transmission charges that are attributable to providing services to the notional tariff base, as calculated in accordance with a methodology approved by the Regulator;

(f) the determination is to allow for the cost to serve for each tariff customer in the determination period;

(g) the determination is to include an allowance for the retail margin;

(h) the maximum price for each component of a tariff is to not increase by more than the percentage change between –

(i) the average price for electricity calculated for the 2006 calendar year in accordance with the 2003 declared electrical service price determination; and

(ii) the average price for electricity calculated for the 2007 retail price determination.

(3)  The 2007 retail price determination is to specify –

(a) how the price that an electricity entity may charge in respect of the retail supply for tariff customers during the determination period is to be calculated; and

(b) any price control mechanisms imposed on an electricity entity in respect of the retail supply for tariff customers during the determination period; and

(c) in respect of the adjustments referred to in subregulation (2)(b) and (c)  –

(i) how those adjustments are to be calculated; or

(ii) the principles and the general manner to be applied in making or calculating those adjustments; and

(d) the date on which the determination takes effect and the date on which the determination ceases to have effect.

(4)  The Regulator does not need to conduct an investigation under Division 2 of Part 3 before making the 2007 retail price determination.

37D.   How 2007 retail price determination may be expressed

The regulation of prices that may be charged, and the price control mechanisms, specified in the 2007 retail price determination may be expressed in that determination in any of the terms or manners specified in regulation 18 .

37E.   Adjustment of 2007 retail price determination

A 2007 retail price determination may be adjusted under regulation 35 as if the 2007 retail price determination were a declared electrical service price determination.

37F.   Amendment or revocation of 2007 retail price determination

The Regulator may amend or revoke a 2007 retail price determination under regulation 36 as if the 2007 retail price determination were a declared electrical service price determination.

5.    Schedule 1 inserted

After regulation 44 of the Principal Regulations , the following Schedule is inserted:

SCHEDULE 1 - Tariffs

Definition of notional tariff base in regulation 37A

	Tariff number	Category	Tariff description
1.	31	Residential	Light and power
2.	41	Residential	Hot water
3.	61	Residential	Off-peak afternoon boost
4.	62	Residential	Off-peak night only
5.	42	Residential	HydroHeat (hot water and space-heating)
6.	22	Business	General
7.	33	Business	Institutional light and power
8.	34	Business	Nursing home light and power
9.	36	Business	Educational
10.	43	Business	Institutional hot water
11.	54	Business	Highlands supply
12.	55	Business	Unmetered supplies
13.	73	Business	Irrigation low rate
14.	74	Business	Irrigation high rate
15.	78	Business	Industrial process heating
16.	82	Business	Monthly kVA demand low voltage
17.	83	Business	Industrial kW demand low voltage
18.	85	Business	Monthly kVA demand high-voltage
19.	86	Business	Industrial kW demand high-voltage
20.	25 and 37	Business	High-voltage energy
21.	26 and 38	Business	High-voltage energy
22.	28	Business	High-voltage energy
23.	35	Business	Nursing homes high-voltage energy
24.	71 and 72	Business	Two-rate supply – low voltage
25.	81	Business	Commercial and industrial power – low voltage
26.	90	Business	High-voltage kW demand

Displayed and numbered in accordance with the Rules Publication Act 1953.

Notified in the Gazette on 5 July 2006

These regulations are administered in the Department of Treasury and Finance.

EXPLANATORY NOTE

(This note is not part of the regulation)

These regulations amend the Electricity Supply Industry (Price Control) Regulations 2003 by allowing the Regulator to make a determination, relating to maximum prices chargeable for the year 2007 in respect of the retailing of electricity to tariff customers in mainland Tasmania, without holding a prior investigation or otherwise complying with Part 3 of those regulations.