PIAC made a submission to the AER concerning Transgrid’s Contingent Project Application for stage 2 (CPA2) of the Humelink Project.
The CPA2 requested approval for $4,279.14 million in capex spending, on top of the $608.73 million of spending already approved for the project in CPA 1, parts 1 and 2. This amount of spending of, ultimately, consumers’ money warrants close scrutiny.
PIAC does not support major elements of the CPA2.
We do support the proposal to waive the Capital Expenditure Sharing Scheme (CESS) for Humelink.
We are not convinced that Humelink produces a financeability issue for Transgrid, and on this basis we do not support the measures proposed to manage this issue.
We do not support the ‘other construction costs’ line item, which amounts to 14% of the total capex reqest, as we do not view it as prudent and efficient spending.
While we do not oppose the project going ahead, we believe major revisions of this CPA2 are needed before the AER should approve the funding request.
