Western Power’s South West Interconnected Network ( SWIN ) is regulated by the Authority, in accordance with the Electricity Networks Access Code ( Access Code ). Main regulatory responsibilities and activities for the Authority under the Access Code include:

Access Arrangements

An access arrangement refers to an arrangement for third party access to a covered network that has been approved by the Authority. The specific content of an access arrangement is outlined in Chapter 5 of the Access Code , while Chapter 4 sets out the approval and review process in detail. In general the approval process can be summarised as follows:

• The service provider submits a proposed access arrangement , to be published by the Authority together with a invitation for submissions from interested parties.
• The Authority may publish an issues paper to facilitate the public consultation process.
• The Authority publishes a draft decision approving or not approving the proposed access arrangement, and invites further submissions from interested parties.
• The service provider may include in its submission on a draft decision made by the Authority, a revised proposed access arrangement (if so, reference to a proposed access arrangement is read as if it was a reference to a revised proposed access arrangement).
• A final decision is published by the Authority approving or not approving the proposed access arrangement.
• If the proposed access arrangement is approved, the proposed access arrangement commences. If not approved the service provider may submit an amended proposed access arrangement .
• The Authority makes a further final decision to approve or not approve the amended proposed access arrangement (or previous proposed access arrangement if no amendment is submitted by the service provider).
• If the amended proposed access arrangement is approved, the amended proposed access arrangement commences. If not approved, the Authority must draft, approve, publish and advertise its own access arrangement .

Further information, together with submitted access arrangements and revisions can be found under Access Arrangements .

Technical Rules

Technical rules consist of the standards, procedures and planning criteria governing the construction and operation of an electricity network, and deal with all matters listed in Appendix 6 of the Access Code .

More information on technical rules, including the technical rules approved by the Authority can be found under Technical Rules .

Guidelines

The Authority is required in some instances, under the Access Code, to publish guidelines (i.e. information) that detail certain requirements to assist it in meeting its regulatory roles and responsibilities, such as the requirements for a major augmentation proposal. In other instances the Authority may publish additional information, in the form of guidelines, to assist electricity service providers and other parties in meeting their obligations under the Access Code.

Guidelines published by the Authority can be found under Guidelines .

Price Determinations

Access arrangements may require a service provider to submit price lists to the Authority for approval. In these instances, the service provider must submit to the Authority a proposed price list for the next pricing year and price list information. Once submitted, the Authority is required to assess the proposed price list to ensure that it complies with the price control and pricing methods in the service provider’s access arrangement.

Determinations made by the Authority in respect of price lists can be found under Price Determinations .

Service Standard Benchmarks

A service standard can refer to either the technical standard and/or reliability, of delivered electricity. Under the Access Code, a service provider must include, as part of its access arrangement, service standard benchmarks for each of its reference services.

The Authority must monitor and, at least once each year, publish the service provider’s actual service standard performance against its service standard benchmarks.

Further information, including service standard performance reports submitted to the Authority, can be found under Service Standards.

Network Augmentations

An augmentation in relation to a covered network, means an increase in the capability of the covered network to provide covered services, including by the development, construction, acquisition or commissioning of new network services.

Major augmentations are augmentations for which the new facilities investment exceeds certain monetary thresholds set by the Access Code. Major augmentations must pass a regulatory test before a service provider can commit to the augmentation.

Under the Access Code, the Regulatory Test requires a service provider to submit a major augmentation proposal to the Authority, either as part of an access arrangement approval process or outside the process. A major augmentation proposal submitted outside an access arrangement approval process may include a request for the Authority to determine whether the forecast new facilities investment proposed will meet the new facilities investment test.

More information about the Regulatory Test and new facilities investment test, including major augmentation proposals submitted to the Authority, can be found under Network Augmentations .

WACC Methodology

Under the Access Code an access arrangement must set out the weighted average cost of capital ( WACC ) for a covered network. The WACC is expressed as a percentage and means a weighted average of the cost of debt and the cost of equity as calculated under section 6.64 of the Access Code .

The Access Code allows the Authority to make and publish a determination of the preferred methodology for calculating the WACC in access arrangements. More information about the WACC, including the Preferred WACC Methodology as published by the Authority, can be found under WACC Methodology .

Ringfencing

The Access Code provides for ringfencing arrangements to ensure that network service providers deal with related businesses and other associates on an arms-length, commercial basis. Chapter 13 of the Access Code gives the Authority powers to monitor and enforce these arrangements, including through the establishment of "ringfencing rules".

The Authority published a discussion paper on the development of ringfencing rules for electricity networks businesses. The Authority has since determined that it will defer further consideration of the development of ringfencing rules following the disaggregation of Western Power in April 2006.