7ARevenue and pricing principles

7A Revenue and pricing principles

7A Revenue and pricing principles

(1) The revenue and pricing principles are the principles set out in subsections (2) to (7).

(2) A regulated network service provider should be provided with a reasonable opportunity to recover at least the efficient costs the operator incurs in—

(a) providing direct control network services; and

(b) complying with a regulatory obligation or requirement or making a regulatory payment.

(3) A regulated network service provider should be provided with effective incentives in order to promote economic efficiency with respect to direct control network services the operator provides. The economic efficiency that should be promoted includes—

(a) efficient investment in a distribution system or transmission system with which the operator provides direct control network services; and

(b) the efficient provision of electricity network services; and

(c) the efficient use of the distribution system or transmission system with which the operator provides direct control network services.

(4) Regard should be had to the regulatory asset base with respect to a distribution system or transmission system adopted—

(a) in any previous—

(i) as the case requires, distribution determination or transmission determination; or

(ii) determination or decision under the National Electricity Code or jurisdictional electricity legislation regulating the revenue earned, or prices charged, by a person providing services by means of that distribution system or transmission system; or

(b) in the Rules.

(5) A price or charge for the provision of a direct control network service should allow for a return commensurate with the regulatory and commercial risks involved in providing the direct control network service to which that price or charge relates.

(6) Regard should be had to the economic costs and risks of the potential for under and over investment by a regulated network service provider in, as the case requires, a distribution system or transmission system with which the operator provides direct control network services.