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Third Price Controls (PC3)
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Third Price Controls (2006 - 2009) (PC3)
In August 2004, the Bureau commenced a review of the PC2 price controls. Draft Proposals for third price control PC3 (2006-2009) were issued by the Bureau in July 2005. On 14 November 2005, the Bureau published its Final Proposals for the PC3 period (2006-2009 inclusive).
The form of controls remained CPI-X revenue capped linked to 'revenue drivers' with a Performance Incentive Scheme (PIS). The new incorporated structural features compared to PC2 are as follows:
- All controls were set for a four-years duration (2006 - 2009 inclusive);
- Separate price controls were introduced for ADWEC's water and electricity businesses;
- All income from licensed activities were included within 'regulated revenue'; and
- ADWEC will be required to produce a formal report to the Bureau of its unit production costs increase (for water and electricity separately) compared to the previous year.
- The definitions of revenue drivers were unchanged from the PC2 period except for peak demand-related drivers for TRANSCO (for both water and electricity), which were based only on metere units in compliance with the Metering and Data Exchange Code at exit points on leaving the transmission system.
Due to sector companies' concerns, the Bureau decided to postpone the separation of distribution and supply business controls of ADDC and AADC till the next price controls review. In the case of RASCO, present price controls have been extended for a further two years (2006 and 2007).
In March 2006, the Bureau published an Addendum to PC3 Final Proposals, concerning ADDC and AADC only. The PC3 price controls have been accepted by all concerned licensees (AADC, ADDC, ADWEC and TRANSCO) and came into effect on 1 January 2006.
The PC3 published consultation papers are as follows:
 PC3 First Consultation Paper
PC3 Second Consultation Paper
PC3 Draft Proposal
PC3 Final Proposal
Addendum to Final Proposal for PC3 (AADC and ADDC
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