❓ Hon. Amber-Jade Sanderson raises concerns about high electricity connection charges for agricultural businesses in the Swan Valley, prompting a response outlining the cost-sharing scheme and potential future changes under national regulations.
AnsweredQoN 955Legislative Council
QuestionView source ↗
ELECTRICITY CONNECTION — SWAN VALLEY — WESTERN POWER
955. Hon AMBER-JADE SANDERSON to
the Leader of the House representing the Minister for Energy:
I
refer to the exorbitant electricity charges that Western Power is charging for
the assessment and design of new connections in the Swan Valley—for
example, a recent quote of over $6 000 simply for the design and quotation of a
new electricity connection to a vineyard in the valley. Will the minister
immediately review these charges, given the significant costs and impact these
charges will have on continuing agricultural production in the valley?
955. Hon AMBER-JADE SANDERSON to
the Leader of the House representing the Minister for Energy:
I
refer to the exorbitant electricity charges that Western Power is charging for
the assessment and design of new connections in the Swan Valley—for
example, a recent quote of over $6 000 simply for the design and quotation of a
new electricity connection to a vineyard in the valley. Will the minister
immediately review these charges, given the significant costs and impact these
charges will have on continuing agricultural production in the valley?
AnswerView source ↗
I thank the honourable member for
some notice of the question. Based on the information provided, Western Power
assumes the member was referring to connection costs for commercial premises.
For most commercial connections, the distribution low-voltage connection
headworks scheme—the scheme—applies. The scheme allows for the
cost of infrastructure required for new customer connections to be shared by
all customers using the installed network. The scheme provides a charge on the
basis of requested capacity, 1 000 volt amps—kVA—rather than on
whether the current network will have to be expanded as a consequence of the
submitted application. The scheme cost replaces the cost of augmentation for
customer connections and upgrades. The cost is based on a set of per kVA rates
reflecting the average cost of supply per unit of load—kVA. When there
is sufficient information, the costs to the customer are further offset by the
expected revenue from the connection point over a 15-year period. The scheme
was reviewed and approved by Western Power's independent regulator, the
Economic Regulation Authority, on 4 September 2012. It is important to remember
there are significant costs in designing and connecting new commercial premises
to the network. In general terms, the cost of connection mentioned by the
member does not seem unreasonable given the varying scopes of network
augmentation requested by commercial customers.
The Liberal–National
government introduced the National Electricity (Western Australia) Bill 2016
into Parliament on 23 June 2016. The purpose of the bill is to apply the
national regulatory framework to electricity networks in Western Australia. The
requirements for capital contributions under the national framework recognise
that a network upgrade or reinforcement generally benefits all customers
connected to the network by making the whole electricity network more robust
and reliable. It is anticipated that in most cases this will result in a reduction
in costs for residential and small commercial customers seeking to connect to
the network compared with the current framework.
some notice of the question. Based on the information provided, Western Power
assumes the member was referring to connection costs for commercial premises.
For most commercial connections, the distribution low-voltage connection
headworks scheme—the scheme—applies. The scheme allows for the
cost of infrastructure required for new customer connections to be shared by
all customers using the installed network. The scheme provides a charge on the
basis of requested capacity, 1 000 volt amps—kVA—rather than on
whether the current network will have to be expanded as a consequence of the
submitted application. The scheme cost replaces the cost of augmentation for
customer connections and upgrades. The cost is based on a set of per kVA rates
reflecting the average cost of supply per unit of load—kVA. When there
is sufficient information, the costs to the customer are further offset by the
expected revenue from the connection point over a 15-year period. The scheme
was reviewed and approved by Western Power's independent regulator, the
Economic Regulation Authority, on 4 September 2012. It is important to remember
there are significant costs in designing and connecting new commercial premises
to the network. In general terms, the cost of connection mentioned by the
member does not seem unreasonable given the varying scopes of network
augmentation requested by commercial customers.
The Liberal–National
government introduced the National Electricity (Western Australia) Bill 2016
into Parliament on 23 June 2016. The purpose of the bill is to apply the
national regulatory framework to electricity networks in Western Australia. The
requirements for capital contributions under the national framework recognise
that a network upgrade or reinforcement generally benefits all customers
connected to the network by making the whole electricity network more robust
and reliable. It is anticipated that in most cases this will result in a reduction
in costs for residential and small commercial customers seeking to connect to
the network compared with the current framework.
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