The AER approved Essential Energy’s 2024–29 revenue requirements on 30 April 2024 in response to our Regulatory Proposal and Tariff Structure Statement (TSS). Our Regulatory Proposal outlines how we will operate and maintain our network, along with proposed capital investments and associated costs, over the five years from 1 July 2024.

The Regulatory Proposal was informed by extensive consultation with more than 400 customers and stakeholders, via multiple engagement events across our network area.

Over the next five years we will keep our customers and stakeholders informed about how we are tracking on implementing the plans in the Proposal that they supported.

We will focus on building the network for the future to further enable increasing levels of Consumer Energy Resources (CER), such as rooftop solar. We will also enhance network and community resilience to support the economic growth of the 1,500 regional, rural and remote communities we serve. This includes initiatives such as installing composite poles, introducing a portable community hub, portable streetlights and Stand Alone Power Systems (SAPS) for use during significant weather and network events. See ‘Resilience’ for more information.

The AER decision will allow Essential Energy to recover $6,309.9 million from customers over the 2024–29 period and considers the revenue impact of external factors, including increases to interest rates and inflation.

Assuming no other changes, the AER estimated this revenue allowance will result in an average increase to the distribution network component of electricity bills for our customers of $39 per year for typical residential customers and $83 per year for typical small business customers, over the next five years.

Total network charges, which Essential Energy passes to electricity retailers who recover these costs from customers through electricity bills, include:

• Essential Energy’s distribution network charges – revenue Essential Energy is approved to recover from customers. From July 2024 this includes charges related to legacy meters (see Smart meters)
• Transmission network charges – which we pass through from transmission network businesses
• Levies from government programs – including for the NSW Government Climate Change Fund, NSW Electricity Infrastructure Roadmap, and the Queensland Solar Scheme.

Retailers choose how they bundle the costs of these components into customers’ electricity bills.

Essential Energy’s proposed price increases for 2024–25 were approved by the AER and took effect on 1 July 2024. The increases incorporate the total network charges listed above.

If passed on in full by retailers, compared to 2023-24, customers’ annual network electricity bills (Essential Energy’s distribution network component plus transmission network charges and government levies) will increase by an average of:

• $113 or 12.7 per cent for residential customers
• $213 or 7.7 per cent for small business customers.

We encourage customers to speak to their retailer if they need help with paying their electricity bills following the increase, and to shop around for the best deal.

We introduced two-way pricing tariff structures from 1 July 2024 to encourage customers who generate energy behind the meter (such as from solar panels and batteries) to export into the network when it is most needed.

For the first year this will only apply to our new storage and hybrid tariffs.

Approved by the AER as part of our TSS, two-way tariff structures encourage those generating their own electricity to use it themselves before exporting into the network. It does this by offering a rebate if exports occur during the evening peak time of 5pm to 8pm on the low voltage network, and applying a charge to exports above a free basic export level from 10am to 3pm, when consumption is lower. These export pricing arrangements will be transitioned in for residential and small business customers from 1 July 2025.

With more than 32 per cent of our customers having solar panels, the two-way tariff structure is designed so that only customers who export electricity fund the network upgrades necessary to support this two-way flow of electricity. Funds received will be used to offset export rebates to customers and supplement the costs of upgrading the network.