The Australian Energy Regulator TasNetworks Public Forum Revenue Proposal 1 July 2014 to 30 June July 2014

Agenda Registrations and coffee (9.30 – 10.00) Introduction and the AER’s process ( ) – Andrew Reeves TasNetworks presentation (10.15 – 11.00) AEMO presentation ( ) Morning tea ( ) CCP presentation (11.45 – 12.15pm) Q & A ( pm) AER wrap-up ( pm)

Introduction Forum held to assist AER in making transmission determination for TasNetworks (Transend) under Chapter 6A of the National Electricity Rules (NER) The AER will set TasNetworks revenue cap for a 5 year period from 1 July 2014 to 30 June 2019 TasNetworks’ revenue proposal, proposed negotiating framework and proposed pricing methodology are available on the AER website Issues paper released to assist stakeholders in making submissions Written submissions are invited by 1 August 2014

Regulatory framework AEMC’s new rules in place 2012 AER’s Better Regulation Program finalised in 2013 Framework and Approach (F&A) paper released in January 2014 Transitional decision 28 March 2014

AER’s review process The AER will assess TasNetworks’ revenue proposal, including pricing methodology, against the NER requirements Interested parties are invited to make submissions to the AER on the initial and revised revenue proposals Separate to this review, AER will also publish its first benchmarking report by 30 September 2014

Timeline – key dates Proposal received2 June 2014 Public forum9 July 2014 Submissions due1 August 2014 Draft decision30 Nov 2014 Pre-determination conferenceDecember 2014 TasNetworks’ revised proposalJanuary 2015 Submissions due February 2015 Final Pricing Methodology28 March 2015 Final decision due 30 April 2015 New network charges commence1 July 2015

How does proposal affect consumers Transend–Indicative transmission price path from 2009–10 to 2018–19 ($/MWh, nominal)

AER approach Our analysis of the revenue proposal will necessarily consider each of the revenue components and any inter-relationships between these components as we must decide the businesses revenues as a whole. In assessing the proposed revenue, we will have regard to our ‘Better Regulation’ Guidelines, including: ◦For capex and opex we will have regard to our Expenditure Assessment Guideline – and the results from our first benchmarking report ◦For the cost of financing (require rate of return) we will have regard to our Rate of Return Guideline We will be interested in hearing consumer views on Transend’s consumer engagement initiatives (including engagement on its proposed changes to the pricing methodology)