Policy

$593 million goes onto NSW network charges this year for the Roadmap. The rulebook for how is now with the AER, final guideline due in September

The NSW Electricity Infrastructure Roadmap is paid for by a levy that almost nobody sees, because it does not appear on a bill under its own name. For 2026-27 it is $593.16 million, split across the state’s three distribution networks, and the regulator says plainly where it goes: the distributors will recover the amounts through their approved 2026-27 network charges. The guideline that sets how the figure is calculated is now under review, and submissions closed on 19 August 2026.

31 July 2026 · two AER notices, read 31 July 2026

Under the NSW Electricity Infrastructure Investment Act 2020, the AER must make an annual contribution determination by 28 February setting out the costs of implementing the Act for the coming financial year. The fourth was released and gazetted on 18 February 2026.

The amounts each distributor must pay:

• Ausgrid - $254.23 million
• Endeavour Energy - $221.40 million
• Essential Energy - $117.53 million

From there the money moves along a chain that is worth following, because each link is a place where a decision gets made. The NSW Scheme Financial Vehicle implements the determination by issuing quarterly contribution orders to the distributors. The distributors recover the amounts through their approved network charges. The AER receives their pricing proposals, including proposed network charges, by 1 April.

What the money covers, per the AER’s consultation notice, is the Roadmap’s liabilities as they fall due: underwriting new renewable generation or storage investment, network investment, and the administration costs of Roadmap entities.

The rulebook is what is actually open

The $593.16 million is settled for this year. What is open is the method, and that is the more consequential thing because it applies to every determination after this one.

The AER is consulting on its 2026 Review of the NSW Electricity Infrastructure Fund Contribution Determination Guideline and the associated Contribution Determination Model, to keep the framework fit for purpose as the NSW Electricity Infrastructure Roadmap matures. Its stated aims are to improve the framework’s operation, clarify the roles and responsibilities of scheme entities, set out key methodologies it proposes to apply as standard practice, and improve transparency and predictability.

This was flagged in advance. The February determination notice said the AER planned to run a public consultation during 2026 on the method for the contribution determination under section 56 of the EII Act, and on the method for determining the percentage relating to long-term energy service agreements under clause 36 of the Electricity Infrastructure Investment Regulation 2021. The July consultation is that promise arriving.

Submissions closed at close of business 19 August 2026, to rez@aer.gov.au with the title Contribution Determination Guideline 2026 review - submission. The final guideline is expected in September.

Two deadlines, two mechanisms, one bill

There is a second consultation open on the same beat right now, and a reader with a view on how network costs are set has two places to put it:

• 19 August 2026, now closed - this one, on the method for calculating the Roadmap contribution.
• 21 August - the three distributors’ cost pass through applications for the solar backstop, worth roughly $128 million between them.

Our view, labelled as such: these are different mechanisms reaching the same place, and the difference matters. A cost pass through is an application about money already spent, assessed after the fact, and there is a rule under which silence approves it. A contribution determination is an annual calculation under a published method, made in advance whether anyone comments or not. The second is the more transparent design, and it is also the one carrying four and a half times the money. The consultation now open is about that method, which makes it the higher-leverage of the two even though it names no dollar figure of its own.

We are not going to tell you what either adds to a household bill. Neither notice says, network charges are one component of a retail price among several, and dividing a state total by a customer count we have not verified would be arithmetic dressed as reporting.

$162 million of this year's levy is pre-funding next year's

The AER's announcement gives the total and the split. The determination itself was gazetted, and the gazette notice explains how the number was built. One line in it is the story.

In setting the minimum prudent cash balance for 2026-27, the AER included a transitional reserve of $162.22 million, and says in terms why: to reduce a forecast increase in the 2027-28 contribution determination amount. So roughly 27 per cent of this year's $593.16 million is being collected now to flatten a rise that was forecast for next year. That is a defensible piece of smoothing and it is also a signal, because a reserve is only built against an increase somebody has already modelled.

The rest of the liquidity picture, none of which is in the announcement: the Scheme Financial Vehicle expects to manage an estimated total liquidity risk of $401.17 million across 2026-27. The minimum prudent cash balance target is $269.10 million, and because the Fund recovers that amount during 2025-26 the vehicle does not need to recover further money to reach the target this year. The remaining $132.07 million of liquidity risk is covered by facilities rather than cash.

Why your network pays what it pays

The split is not arbitrary and it is not per-customer. Under clause 35 of the Electricity Infrastructure Investment Regulation 2021 the AER must allocate between distributors based on each one's volumetric energy delivery and peak demand in the previous financial year. Its guideline applies those two metrics differently: the costs of long-term energy service agreements are apportioned on an energy delivered basis, and every remaining cost element on a peak demand basis.

The same clause requires the AER to limit year-to-year variability, which it does by using a three-year rolling average of net costs. Each scheme entity gives the regulator cost estimates covering two leading years and one lagging year, capturing long-term energy service agreements, payments to network operators and the administration costs of the scheme entities themselves.

Two pieces of small print worth knowing. The gazette rounds every figure to two decimal places but records that the unrounded numbers are what get implemented. And the published version of the calculation model is deliberately incomplete: the AER says much of the underlying data relates to ongoing competitive tender processes that could be compromised by publication, and that it intends to publish the data once it is historical. That is a reasonable position and it does mean the workings behind a $593 million charge cannot be fully audited from outside today.

Sources

1. Australian Energy Regulator, Contribution Determination for 2026-27, NSW Government Gazette No 59, 18 February 2026 (downloaded and read 1 August 2026): that the AER was appointed a Regulator under the Electricity Infrastructure Investment Act 2020 on 12 November 2021 and made this determination under section 56(1) on 11 February 2026; the $593.16 million total and the Ausgrid, Endeavour Energy and Essential Energy amounts; the $401.17 million estimated total liquidity risk, the $269.10 million minimum prudent cash balance target and the $132.07 million managed through liquidity facilities; the $162.22 million transitional reserve included to reduce a forecast increase in the 2027-28 amount; the apportionment of long-term energy service agreement costs on an energy delivered basis and remaining costs on a peak demand basis; the three-year rolling average of net costs using two leading and one lagging year; the note that figures are rounded in the gazette but implemented unrounded; and the statement that the public model omits data relating to ongoing competitive tender processes.
2. Australian Energy Regulator, Contribution determination for 2026-27 under NSW Roadmap released (issue date 18 February 2026, read 31 July 2026): the $593.16 million total, the Ausgrid, Endeavour Energy and Essential Energy amounts, the annual determination duty and 28 February deadline, the gazettal, the Scheme Financial Vehicle's quarterly contribution orders, recovery through approved 2026-27 network charges, the 1 April pricing proposals, and the foreshadowed 2026 consultation.
3. Australian Energy Regulator, AER consults on 2026 draft Guideline about recovery of NSW Roadmap costs (issue date 22 July 2026, read 31 July 2026): the guideline and model review, its four stated aims, the liabilities the Roadmap costs cover, the 19 August 2026 deadline and submission address, and the September 2026 final guideline.

Updated 25 August 2026. Comment on the draft guideline closed on 19 August 2026. We checked the AER rather than assuming: its consultation page still invites submissions by close of business on 19 August 2026 in the present tense, so that is a page which has not caught up with its own date rather than a window still open, and no extension is published. The AER says feedback will be used to inform the final Guideline, expected to be published in September 2026. Changed today, and only these: the headline, the page title, the social title and the structured data all said the rulebook is open for comment, and the page description, the social description and the structured-data description all had the review running to 19 August. A previous freshness pass on 23 August corrected the standfirst and left those six, so for two days this page carried a headline contradicting its own opening paragraph. The figures are unchanged.

Updated 1 August 2026. The original was written from the AER's two announcements. We have since read the determination as gazetted, and added what it explains and they do not: that $162.22 million of this year's total is a transitional reserve held to reduce a forecast increase in 2027-28, the liquidity figures behind the number, the energy-delivered and peak-demand basis on which the three distributors' shares are set, the three-year rolling average used to limit variability, and the AER's reason for publishing an incomplete model. The $593.16 million total and the three distributor amounts are unchanged.

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