The Australian Competition Tribunal handed down its decision today on its review of the Australian Competition and Consumer Commission's tariff determination for transportation services on GasNet's Victorian natural gas transmission system.
The Tribunal's judgement will allow GasNet benchmark revenues of approximately $79 million a year on average for five years. This compares with benchmark revenues averaging $95 million a year originally proposed by GasNet to the ACCC and the determination made by the ACCC of $77 million.
"In its application to the Tribunal for review of the ACCC's determination, GasNet contended that the ACCC should have approved GasNet's revised access arrangement of January 2003 rather than drafting and approving its own access arrangement", ACCC Commissioner, Mr John Martin, said today.
"GasNet contended that the ACCC had made errors in the way it determined five aspects of GasNet's capital and non-capital costs.
"GasNet later withdrew its contentions regarding equity beta, the major item in its overall claim. During the course of the Tribunal hearing the ACCC agreed that there were grounds for additional allowances in relation to two of the smaller cost items. The Tribunal also accepted GasNet's approach to calculating the risk free rate".
Mr Martin said that the ACCC welcomed the clarification provided by the Tribunal of the requirements under the gas code and the gas access law.
"This legislation is still comparatively new, and there has been little legal precedent available. The ACCC will be guided by the findings in future decisions".