EUAA Submission: Review of CBA and RiT-T Guidelines
Emily Wood | June 19, 2023
‘…The EUAA was one of the proponents of the Material Change in Network Infrastructure Costs rule change. While our proposal covered both transmission and distribution projects, our focus was on large transmission projects, particularly ISP projects. Our original proposal in January 2021 highlighted the significant increase in ISP project costs over the course of the RIT-T process and leading up to the contingent project application1. All the evidence since then has only reinforced this.
This cost escalation, plus the rules saying it was the project proponent that determines whether a material change had occurred, meant that consumers had no confidence that the project met the net benefits test. We simply did not trust project proponents to undertake the assessment of material change in a transparent way given there is a huge information asymmetry between the proponent and consumers. It was no surprise to us that there had never been a material change despite the observed increases in project capital cost. Proponents have no incentive to do so given the potential requirement to reconsider and publish a revised PACR….’
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