DETERMINING REVENUES AND PRICING
In Victoria, gas distribution is regulated by the Australian Energy Regulator (AER) under a national framework. Under this framework, we are required to submit a proposal outlining the services that we will offer, the costs associated with the provision of these services, and the prices to be charged to customers over a five year period. This process is known as the Gas Access Arrangement Review (GAAR).
The Gas Access Arrangement Review 2018 – 2022
Our current regulatory period expires on 31 December 2017. We are currently in the process of developing our proposal for the upcoming 2018-2022 regulatory period. There are a number of key dates in this process, which are listed in the table below.
||Submission of our regulatory proposal to the AER
||AER hold public forum
||Submissions on our revenue proposal close
||AER publishes its draft decision
||Submission of our revised regulatory proposal to the AER
||Submissions on draft determination and revised revenue proposal close
||AER publishes its final decision for next regulatory period
Our 2018 – 2022 Gas Distribution Plans
Once we have finished drafting our 2018-2022 GAAR plans for the gas distribution network we will prepare a plain-language overview. This overview will be published with our proposal in December 2016.
Our customer and stakeholder engagement program
In April 2016, we launched a comprehensive customer and stakeholder engagement program comprising of four studies. The program is designed to help us better understand the gas-related needs, wants and preferences of our customers and stakeholders. The insights from this engagement program will be used to inform our GAAR submission to ensure that it reflects the preferences and priorities of our customers and stakeholders.
A brief overview of the findings from each of the studies is presented below. However, for those interested in a more detailed description of each of these studies, please refer to the specific report attached.
Study 1 - Findings from customer focus groups
This study consisted of five focus groups with regional and metropolitan customers of our gas network. Each focus group was approximately 2 hours in duration and covered a range of issues associated with gas and the gas network.
A range of interesting insights were revealed and shared amongst participants, including:
- Customers value gas as an instantaneous and reasonably priced energy source,
- The gas network is perceived to be extremely reliable,
- Although safety-related incidents are not common, safety was a major concern for customers due to the potential seriousness of a safety breach; and
- Customers envisage using gas into the future despite usage being expected to decrease, as renewables become more affordable.
Study 2 - Findings from customer survey
An online survey was used in Study 2 to explore, in more detail, the customer issues identified in Study 1. The survey was completed by 600 regional and metropolitan AusNet Services gas customers.
Key findings from the survey include:
- Around one quarter (26%) of AusNet Services gas customers are aware of AusNet Services and of them, only half (51%) understand that AusNet Services is a gas distributor,
- Seventy-nine percent of customers believe that the network is reliable, 72 percent feeling it is safe and 69 percent feeling that it is well maintained,
- When it comes to price, customer sentiment is mixed, with approximately half feeling gas is good value for money (49%) and reasonable priced (44%),
- Approximately two thirds of customers are satisfied with AusNet Services as their gas distributor (65%); and
- Four in five (80%) customers have no plans to disconnect from the gas network in the future, with only 10% of customers expecting to disconnect in the next five to 10 years.
Study 3 - Findings from customer advocate workshop
The third study in our customer and stakeholder engagement program was a workshop with customer advocate groups. Specifically, we spoke with representatives from a range of organisations representing customers of varying socio-demographic profiles. The purpose of this workshop was to (i) confirm the findings from studies 1 and 2 and (ii) gather their thoughts on how the insights gleaned from the first two studies could inform key business decision for the gas network.
Study 4 - Findings from stakeholder focus groups and interviews
To ensure that the voices of all stakeholders operating within our gas network were captured, Study 4 consisted of focus groups and a number of one-on-one interviews with non-residential customers. Specifically, 4 focus groups were conducted with customers from small to medium businesses.
We also conducted a series of one-on-one interviews with representatives from local councils, large industry and land developers situated within in our gas network.
What are customers telling us?
We will be publishing a report that summarises the findings from our four-phase research program for the gas network. The purpose of this document is to summarise the general sentiments of the majority of our customers and stakeholders who were involved in this customer engagement and research work.
We would like to acknowledge and thank all of our customers and stakeholders for their efforts in helping us understand what is important to customers connected to our gas network both now and into the future.
GAAR Fact Sheets
We recognise that there are a number of processes associated with the GAAR process that are highly technical and cover off on concepts that our customers and stakeholder may not be familiar with. To help avoid confusion and be transparent in the GAAR process, we have developed two fact sheets that summarise the key information about the GAAR and how we are engaging with customers and stakeholders during the regulatory review process:
If you would like to know more about our customer and stakeholder and engagement program or the GAAR process in general, please contact us at: GAAR2018@ausnetservices.com.au.