WACC Parameters Rule change - economic analysis

Financial Year: 2006/07

Propose to the AEMC a change to Chapter 6 of the NER that will challenge the current level of two key parameters used in setting the Weighted Average Cost of capital (WACC) i.e. effectively the profit margin for distributors. The parameters are the Equity Beta which is set at 1.0 and Market Risk Premium of 6.0%. The EUAA argues that these levels are too high and therefore end-users of electricity are paying too much for distribution charges.

Grant Details Grant Content
Grant Reference Number: 243
Applicant: Energy Users Association of Australia
Grant Amount: $34,000
Approval Status: Yes
Financial Year: 2006/07
Grant Type: Electricity Advocacy
Energy Type: Electricity
Jurisdiction: National,WA
Consumer Class: Large Business


Submission to AER on Real Risk Free Rate: SP Ausnet and ElectraNet Revenue Resets
Review of Parameters in the NER

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