Industry Forum

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Industry Forum Inquiry into making a Final Access
Determination for the Domestic Transmission
Capacity Service
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1. Welcome to the DTCS FAD Industry Forum

• Part of the public inquiry into a final access
  determination for the domestic transmission
  capacity service

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AGENDA

• Welcome - Ed Willett
• Background and approach to pricing the DTCS - Rob
  Nicholls
• Route definitions and distance issues - Grahame
  O'Leary
• Pricing tail-end DTCS services Grahame OLeary
• Development of the linear regression model -
  Grahame O'Leary
• Pricing protected and unprotected services -
  Grahame O'Leary
• Non-price terms and conditions of access -
  Grahame O'Leary
• Conclusion and next steps - Ed Willett

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2. Background

• Competition and Consumer Act 2010
  requirementAccess determinations may include
  price and non-price terms
• 2010 - ACCC inquiry into DTCS pricing and
  domestic benchmarking approach
• December 2010 - Information sought from
  transmission providers
• April 2011 - DTCS IAD published
• June 2011 - DTCS FAD public inquiry and
  discussion paper
• August 2011 DTCS FAD Industry Forum

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3. Route definitions

• ACCC proposes to adopt the following route
  definitions
• inter-capital routes
• regional routes
• metropolitan routes
• regional tail-end routes and
• metropolitan tail-end routes

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3. Route definitions

• Inter-capital route - from an ESA in a capital
  city to an ESA in another capital city
• Darwin and Hobart to be priced as inter-capital
  routes
• Regional route - at least one ESA outside a
  capital city
• Metropolitan route wholly within a capital city
• Regional tail-end route - wholly within a single
  ESA outside a capital city
• Metropolitan tail-end route - wholly within a
  single ESA inside a capital city

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3. Capital city boundaries

• ACCC proposes to define the boundaries of capital
  cities as
• Adelaide a 25 km radius from a CBD ESA
• Brisbane a 25 km radius from a CBD ESA
• Canberra a 15 km radius from a CBD ESA
• Darwin a 10 km radius from a CBD ESA
• Hobart a 10 km radius from a CBD ESA
• Melbourne a 45 km radius from X km east of the
  CBD
• Perth a 30 km radius from a CBD ESA
• Sydney a 50 km radius from a CBD ESA
• No radial boundaries for regional centres

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Boundary of Sydney
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Boundary of Melbourne
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3. Distance issues

• Distance is measured in different ways
• Radial distance
• Specified regional routes
• Regional areas
• DTCS IAD used radial distance

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4. Pricing tail-end DTCS services

• Tail-end services appear to be provided as
• part of a bundle of transmission service, or
• a stand-alone service.
• DTCS IAD priced tail-end services as stand-alone
  services.

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4. Pricing tail-end DTCS services

• The ACCC is considering prices for
• stand-alone tail-end services
• metro route prices for tail-end services bundled
  with metro or inter-capital services
• regional route prices for tail-end services
  bundled with regional services

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• A short break
• See you at 11.00am

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5. The linear regression model

• Prices set by benchmarking prices of competitive
  transmission services.
• Draft regression model on ACCC website
• Draft regression model estimates annual charge
  for different
• capacities
• distances
• network interface, and
• level of protection.

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5. The linear regression model

• Draft DTCS FAD to include annual charges and
  connection charges
• Draft DTCS FAD will include final regression
  model

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6. Pricing protected and unprotected services

• DTCS should be priced as a protected service
• DTCS IAD prices are for protected services
• Draft regression model estimates prices for
  protected and unprotected DTCS services
• Final FAD regression model will include prices
  for protected and unprotected DTCS services

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7. Non-price terms and conditions of access

• The non-price terms in the DTCS IAD cover the
  following areas
• Billing and notification
• Creditworthiness and security
• General dispute resolution and procedures
• Confidentiality provisions
• Communications with end-users
• Network modernisation and upgrade provisions
• Suspension and termination, and
• Facilities access.

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Non-price terms and conditions of access

• Commencement and expiry
• DTCS FAD will commence on publication
• DTCS IAD automatically revoked
• DTCS FAD expiry 31 March 2014 when DTCS
  declaration expires

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8. Conclusion and next steps

• Submissions to Discussion Paper close on 29
  August 2011.
• ACCC expects a draft DTCS FAD for public comment
  in third quarter 2011.
• ACCC final DTCS FAD in December 2011.

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• Thank you for your participation

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www.accc.gov.au