Essential Energy notes The Daily Telegraph article published on 20 February titled “Essential Energy’s $60m senior manager surge revealed”. The article draws several conclusions that do not accurately reflect how Essential Energy operates or how customer charges are determined.

To clarify the record, Essential Energy responds to the claim that senior manager numbers are driving higher electricity bills:

Essential Energy’s position:

• Essential Energy does not set electricity prices.
• Essential Energy’s revenue is determined by the Australian Energy Regulator (AER), which sets a strict revenue ceiling every five years based only on costs it independently assesses as efficient.
• Within a five-year regulatory period, Essential Energy cannot earn a dollar more from customers than the AER allows, regardless of how many staff are employed or how much they are paid.
• Price increases cited in the article rely on outdated estimates and incorrectly include pass-through costs that are unrelated to Essential Energy, including the cost of running the transmission network.
• Essential Energy is not taxpayer funded.

Context about Essential Energy’s network

• Essential Energy provides electricity distribution services across around 95 per cent of New South Wales and parts of southern Queensland.
• Essential Energy operates and maintains more than 190,000 kilometres of poles and wires and supplies approximately 900,000 connected customers, many in rural, regional and remote communities.
• The scale, geography and technical demands of the network mean the cost to serve customers is higher than for metropolitan distribution networks (that have far higher customer density than Essential Energy).
• Essential Energy operates within a tightly regulated framework and remains focused on keeping communities connected and safe, particularly during severe weather and emergency events, while meeting the growing technical demands placed on the electricity network.