Cost Allocation Method
One of the tasks the Australian Energy Regulator (AER) has in regulating network charges is approving our cost allocation method.
Network charges are those tariffs that Ergon Energy can charge for allowing customers and generators to access our network and for the distribution of electricity through that system.
Ergon Energy's Cost Allocation Method (PDF 196.7 kb) for the regulatory control period to June 2015 was approved by the AER in 2009. It ensures that our regulated charges do not attract more than their fair share of Ergon Energy's business costs.
In addition, a Revised Cost Allocation Method (PDF 165.5 kb) was approved by the AER in August 2014, as part of preparations for the five-year regulatory control period from July 2015. This document reflects the requirement that all costs are to be attributed to or allocated between services moving forward. This document applies from 1 July 2015.
It should be noted that the cost allocation method process is different to the process used to specifically develop network tariffs.