Ergon Energy Investment Plans and restructure

Transcription

1 Ergon Energy Investment Plans and restructure 2014

2 About Us Distributor & Retailer 33 remote generators 1.7 million sq km area 97% of Queensland 160,000 km of line Small customer base 700,000 $3B Revenue $11B Asset Value 4500 Employees Low density high consumption 2

3 Market Disruption Policy Carbon Tax, Mandatory Feed In Tariffs, RET, Reliability & Security Standards & Productivity 3

4 The Duck Curve is here Renewables such as solar are changing the game dramatically. The original load curve is moving to the California - Duck curve as a result of solar reducing consumption during the day and load being moved into the evening And now it has come to Queensland 4

5 Capacity: Glass Half Empty or Half Full Generation Transmission Distribution With falling demand and consumption combined with greater distributed generation there is an excess of generation capacity to leverage. AEMO forecast no new generation required for 10 years yet mandatory renewable targets and Feed In Tariffs still exist Powerlink advise that without further augmentation, there is sufficient capacity to support additional load in North Queensland equivalent to the Townsville area. The North West is not part of the NEM. Distribution Network is not effectively utilised, impacted by reduced consumption, security & reliability standards 5

6 Reform: How Our challenge is to transform the purpose and value proposition of the grid in the eyes of our people, the owners, regulators, financiers and our customers, without losing value. Value & Opportunity 6

7 Reform: Efficient Technology Integration Ergon Energy has changed its business model Our Network will be an open access platform that provides equitable access to distributed energy resources and applications enabling an effective market that drives the cost effective outcomes. A key is to integrate new technology to improve efficiency 7

8 Reform: Playing our role to drive the Queensland Economy Ergon Energy is working with the Queensland Government to deliver on initiatives through the The Queensland Plan: a 30-year vision for Queensland PowerQ: a long-term strategy for Queensland s electricity sector Ergon Energy strategic plans align with these key planning documents. In 30 years we aspire to have half the state s population living outside South East Queensland We have infrastructure that supports alternative energy solutions We use technology to bridge distance and partner to drive efficiency 8

9 Ergon Energy: What needs to be achieved We will power the Queensland Economy through Strategic Objectives Customer choice & control Average network price increases below inflation ( ) Increased energy productivity Key Strategic Enablers Effective market Prudent investment Efficient service Outcome Customer value More flexible work practices Strong Queensland economy Developer Charter While always supporting our local communities 9

10 Times have changes looking to the future Total expenditure down over 20% ($1.5B) against the allowed expenditure Stable average network prices (below inflation) from 2015 (next Regulatory period) More customer choice and control Improved service Greater competition Improved tariffs to help customers manage their bills Energy productivity More flexible work practices 10

11 $ billion (real ) Total Expenditure: We Don t Spend To Increase Profit % % Final Determination 2010 Actual and Estimates 2015 Forecast

12 What Are We Spending On? 12

13 Business Restructure Ergon Energy has restructured to deliver our new strategic direction, streamlining accountabilities to focus on effectiveness and efficiency and to enable an effective market to power the Queensland economy. 13

14 Operations restructure Customer Service 14

15 Our commitment to you What does it mean for you? Customer Connection teams are an integral part of the new Customer Delivery Group. A State Customer Connection Manager has been appointed. The State CCM will transform our Customer Connection teams from regionally-focused independently operating groups to a single functional team. The team will focus on delivering consistent and efficient service outcomes to Developers and customers throughout Ergon Energy s geographical supply area to meet customer expectations. 15

16 The Developer Forum To facilitate more effective engagement with the Development Industry across regional Queensland Ergon Energy established the CICW Developer Reference Group A number of improvements have already been implemented as a result of this forum, including:- Changes to requirements for financial guarantees by adopting appropriate risk management profiles Development of a Customer Charter for Developers incorporating specific customer service commitments Revised engineering standards The Reference group meeting is attended by Executive GMs for Customer Service and Network Optimisation and is chaired by the Customer Delivery Manager for Connections Relations and Metering. 16

17 And Drive the Queensland Regional Economy New connections for Developers Charter Formal commitment to the development industry across regional Queensland. Covers capital works projects that are designed and constructed by a developer and then connected to the Ergon Energy network or delivered by Ergon Energy as a network connection service. Charter is for real estate developers who undertake broad area developments through Developer Design and Construct arrangements. Committed to working with developers to deliver the most cost-effective solutions for their electricity connection works. More information including our service promises to you is available from the Ergon Energy website 17

18 And Now - The AER Engagement Program To help us develop our expenditure plans for 2015 to 2020 for the Australian Energy Regulator (AER) we ve commenced a year-long customer-community engagement program. The primary objective of the AER2015 Program is a Distribution Revenue Determination that improves affordability and customer value, while prudently investing for and efficiently delivering a safe, secure and reliable network. We re currently presenting direction statements to Ergon Energy s Customer Council / peak bodies / regional stakeholders. We want to confirm that we have our priorities right. We want your feedback and will communicate with you further.

19 Our Customer Commitments 19

20 Questions Questions 20