Introducing AusNet Services Regulated Energy Services and the Distribution Business

Transcription

1 Introducing AusNet Services Regulated Energy Services and the Distribution Business March 2018

2 Presentation purpose The purpose of this presentation is to provide information on the following key topics: Introduction to AusNet Services Overview of the Electricity Distribution Business Role of the network today Business environment Objectives and strategy 2

3 Safety Topic We never compromise on safety The safety of our people, customers and communities is our highest priority. We retain a relentless commitment to safety and achieving our missionzero safety strategy 3

4 Company Overview 21 March 2018 Author, Department 4

5 We move energy We are an energy delivery services business. 24 hours a day, we move energy safely, reliably and efficiently to over a million Australians through our networks of assets, services, people and solutions 5

6 Where we operate 100% own, operate and control critical energy delivery infrastructure in Victoria Electricity Transmission 6,571km of transmission lines 13,000 towers Electricity distribution 51,933km of electricity distribution network 705,186 customers Gas distribution 11,109km of gas distribution network 676,035 customers * All figures are approximate as at 31 March

7 Focus 2021 Focus 2021 was initiated in FY17. The goals for 2021 are outlined below: Operate all three core networks in the top quartile of efficiency benchmarks Grow our: contracted energy infrastructure asset base to $1bn specialist services to essential infrastructure operators 7

8 Our values Our Corporate Values are the foundation for how we go about achieving our plan objectives. Values express shared beliefs and principles They guide our behaviours when working with each other and with others outside the company 8

9 External factors AusNet Services A little bit of history Network safety programs Construction of major generation infrastructure : TXU acquisition of gas business Privatisation of transmission network 1999: SP acquires transmission business 2000: First EDPR 2004: Merger TXU and Powernet - SP AusNet created 2004: Sold retail business (Energy Australia) 2005: IPO / listed on ASX 2010 Bushfire safety program 2011 missionzero st serious customer engagement for EDPR 2014 SGID acquires shares 2017 Merits review ceased 2017 Smart meter remediation complete 1980s 1990s 2000s 2010s 1994: Disaggregation of SEC 1998: Creation of the NEM 2000 Cheap air con 2001 Full retail contestability 2005 AER formed 2008 Smart meters introduced 2009 Solar 60c feed in tariff 2009 Black Saturday 2009 Market operator (AEMO) created 2010 Elec demand growth slows 2010 Bushfire Royal Commission 2012 Introduction of benchmarking 2013 Tesla EV 2014 NSW privatisation 2015 TFIT to 5cents 2016 SA Blackout 2016 Tesla battery 9

10 Our ownership and business structure Ownership structure Operating structure Board of Directors 31% 49% Regulated Energy Services (RES) Chief Executive Officer Commercial Energy Services (CES) Corporate Functions 20% Electricity Distribution Electricity Transmission Utility & Metering Services Infrastructure Services Public State Grid Singapore Power Gas Distribution Emerging Energy Markets Regulated Metering Asset Intelligence 10

11 Regulated Business Structure The Regulated Energy Services business has been structured as below: 11

12 Our Purpose is to empower communities and their energy future The RES Vision is to be a leading provider of energy network services, delivering value to customers and communities Deliver for the Customer Public Safety Reliability Services Understand wants and needs Enable distributed generation Improve connections Advocate for good policy Be a good employer Safety Development Ensure everyone gets home safely Drive gender diversity Develop future capabilities Be sustainably cost efficient Top quartile performance Continuous improvement Implement step change in cost Embed performance excellence 12

13 Electricity Distribution Network

14 Responsibilities of a distributor Distributors are responsible for organising the electricity connection to customers within their distribution footprint, including: Connecting and disconnecting supply Ensuring interruptions to supply are minimised Performing monthly, bi-monthly or quarterly meter reads Connecting and installing electricity metering to customer s premises Maintenance and upkeep of the network Managing street lighting and faults Performing removal (abolishment) of meters 14

15 Our unique distribution network Split by the Great Dividing Range, the network covers heavily forested and mountainous areas, as well as the low lying and coastal regions of Gippsland. On the northern and eastern fringes of Melbourne, the network services highly populated suburbs including through the heavily vegetated Dandenong Ranges. 80,000 km 2 service area 38,447 km overhead lines 6,169km underground lines 412,157 poles 705,186 customers AusNet Services customer base is more heavily weighted towards residential than any other Victorian distributor 15

16 Our assets AusNet Services electricity distribution network is made up of 45,000 kilometres of electricity lines, predominantly consisting of overhead network traversing rural areas, which have been built over a period spanning from the 1950 s to the present. AusNet Services electricity distribution system consists of a sub-transmission network operated at 66kV and a distribution network operated at voltages of 22 kv, 12.7 kv, 11 kv, 6.6 kv and 240/415 V and 240/480 V. The table below provides a breakdown of asset numbers. Asset Zone substations 53 Number / Length Overhead conductor - 66 kv - 22/11/6.6 kv - SWER - LV 38,383 km 2,517 km 22,734 km 6,460 km 6,672 km Underground cable - 22 kv - LV 1,899 km 4,027 km Distribution transformers Poles Customers connected - Overhead - Underground 59,167 units 378,877 units 706,424 ~ 50% ~ 50% 16

17 Electricity Distribution Environment & Business Plan

18 Electricity Distribution Environment The energy landscape is rapidly changing, impacted by: CUSTOMER AWARENESS Large energy price rises, combined with evolving technology is driving customer choice, expectation and influence COMPETITION BETWEEN PEERS Regulatory benchmarking, is driving cost to serve and efficiency pressures Energy Sector Transformation COMPLEXITY Rapid cost reduction, technological improvements within distributed energy sources, and greater customer control, are driving new business models. 18

19 What are the implications of this change? Changes in electricity use People are choosing solar Increase in alternative energy solution providers controlling local solar & battery Battery prices are decreasing Increase DER penetration Increased availability of data 19

20 To remain relevant, customers & communities must be at the centre of our plans Who is the customer? The customer is the end consumer of the energy we supply and products & services we offer. Why should we care? I have choices and I am changing the way I buy energy. New technologies are attractive to me What is the outcome? Simplification Cost out The fact that we are one step removed from the end customer does not change this we are an integral part of the energy chain. When it goes wrong for me, you are causing me pain, and creating cost I pay more for energy than ever before, I deserve your attention!! Better business outcomes A new way of thinking Focus for prioritisation taking into account their current and future needs 20

21 Our customers are telling us what they want in the future Get with the program and you could make it work for you for the next 100 years EV Customer, November 2017 Future customers want: To have a reliable energy supply - if not, show me the alternatives like offgrid and remote area power systems To decrease costs and make money from generating my own energy To decrease costs and reduce emissions, show me how to be efficient with my energy/appliances To share energy with my neighbours/community and be able to buy energy locally at a reasonable price To have the energy data I need to make my life simple and efficient To facilitate easy charging solutions in and out of home to power my electric/autonomous vehicle..but this is only the beginning and expectations will evolve. 21

22 Examples to date Our business plan response The Environment Underperforming in regulatory cost benchmarking What will we do? We will focus on what customers value by simplifying our business and removing costs Customers want more control & are choosing Distributed Energy Resources (DER) Customers energy needs are changing and the future of Metering unclear in Victoria beyond 2020 We will operationalise new distributed energy solutions and move from a statically managed network to a dynamically managed network We will identify key customer services to drive improvements in experience and satisfaction and utilise customer usage data for network and customer benefits Mooroolbark Mini Grid launch, April Implementing recommendations from Finkel and ENTR 22