EUAA Submission: Victorian Gas Access Arrangements Proposal 2023-2028
Emily Wood | September 30, 2022
‘…This submission provides a combined response to the 1 July Proposals and 2nd September Addendums by AGN, Multinet (MGN), and AusNet Services (AusNet) gas distribution networks in Victoria for the period 2023-2028. It builds on our earlier submission on the Draft Plans where we1:
• Commented on the excellent combined engagement by all three networks
• Recommended further detailed engagement on the future of gas issue
• Discussed the trade-offs around the future of gas:
o the lack of a clear definition around ‘no regrets’ approach to the level of accelerated depreciation and the need for more modelling to inform consumer engagement
o additional capex/opex to help the networks prepare for a low carbon future – why should customers have to effectively pay for a high-risk option that pipeline hydrogen/renewable gas will be economic in the not too distant future?
o highlighted the risks around continued increase in new customers and how this could well increase stranded asset risk for remaining customers which seems to be contributed to by the methodology prescribed under the Victorian Gas Distribution Code to assess whether new customers are economic to connect
• Did not support the proposed expenditure by AGN and MGN on hydrogen readiness nor the opex step change for renewable gas/hydrogen education campaigns
• Expressed the need for a more robust analysis to support the ‘safety’ and ‘environmental’ arguments for extensive mains replacement expenditure; where is the evidence supporting this expenditure if there was no expectation that pipeline renewable gas would be competitive in the future and hence with significant stranded asset/accelerated depreciation risk?
There have been two significant developments in the gas market in the last 6 months….’
Please download attachment to read full submission.
