Distribution Pricing

The Electricity Authority welcomes the Network Transformation Roadmap released by the Electricity Networks Association last Tuesday. 

As the document explains, it will help distribution companies navigate changes in the way electricity distribution networks will be used in the future.

In particular, the Authority is pleased to see the Roadmap complements the Authority’s work on open networks and cost-reflective distribution pricing.

The Authority will soon publish a consultation paper proposing to amend the Distribution Pricing Principles. In advance of this, we sent a short paper to distribution company board members giving an overview of our current thinking on distribution price reform.

The Commission’s draft decision forms part of its Input methodologies review. The Commission’s proposal is relevant to the Authority’s distribution pricing review because it may affect distributors’ incentives to introduce efficient pricing. If a revenue cap is introduced, we would need to take that into account in deciding what further development, if any, to the existing distribution pricing arrangements would be appropriate.