Wholesale electricity cost allowances changing in South Australia

The Essential Services Commission of South Australia today released for public consultation a draft determination to change the wholesale electricity cost allowance.

The Commission is currently investigating the wholesale electricity component of the retail costs that make up the standing contract price. The standing contract is a statutory arrangement under which any residential or small business customers who have not entered into a market‐based contract with a licensed electricity retailer are able to purchase electricity under terms, conditions and prices regulated by the Commission. The investigation was prompted by the Commission’s belief that recent developments in the wholesale electricity market suggested that the forward cost of wholesale electricity was materially lower than was assumed by the Commission in making its initial price determination.

Frontier (Australia) estimated wholesale energy purchase costs for the Commission, which fed into the draft determination.

For more information, please contact Marita O’Keeffe at m.okeeffe@frontier-economics.com or call on +61 (0)3 9620 4488.

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