✨ Gas Pricing Methodology
Disclosure under the Gas (Information Disclosure) Regulations 1997
Maui Development Limited
May 2009
5. REGULATION 20: PRICING METHODOLOGY
5.1 Tariff methodology
The following methodology for setting tariffs is set out in Schedule 10 of the Maui Pipeline Operating Code (MPOC):
Maui Development Limited (MDL) will set the Transmission Charges in accordance with the standard practice adopted by utilities businesses in New Zealand.
Accordingly, MDL will recover the cost and return of capital as follows. MDL will:
a) calculate the Maui Pipeline’s Optimised Deprival Value or Optimised Depreciated Replacement Cost and multiply this value by a nominal WACC, and then subtract any revaluation gains/losses on the asset ("Required Return");
b) calculate the return of capital based on the useful life of the asset ("Depreciation");
c) aggregate the Required Return and Depreciation to derive the "Required Revenue";
d) derive a GJ km tariff ("Tariff 1"); and
e) apply Tariff 1 across the Maui Pipeline Shippers on the basis of quantity of Gigajoules of Gas transported multiplied by the distance of Gigajoules of Gas transported.In any given year, in the event that MDL’s total revenues are more or less that its required revenue, then Tariff 1 may be adjusted for the following years in a manner that endeavours to reduce pricing volatility for Shippers.
The approach adopted by MDL to recover operating expenditure is to:
a) aggregate the Maui Pipeline’s operating costs ("Operational Expenditure");
b) allocate Operational Expenditure across every Gigajoule of Gas delivered from the Maui Pipeline.In any given year, in the event that MDL’s total Operational Expenditure recovery is more or less that its required recovery, then Tariff 2 may be adjusted for the following years in a manner that endeavours to reduce pricing volatility for Shippers.
5.2 Tariffs
Tariff rates are posted on the CATIS website at https://www.catis.co.nz/ in the Public Domain Information Exchange portion of the site. The tariffs applied are set out in the following table:
| October 2005 to May 2007 | June 1 2007 to May 31 2008 | June 1 2008 to Dec 31 2008 | |
|---|---|---|---|
| Tariff 1 (c/GJ.km) | 0.1149 | 0.1341 | 0.1492 |
| Tariff 2 (c/GJ) | 9.6 | 9.2 | 9.7 |
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NZ Gazette 2009, No 81
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Maui Development Limited Gas Information Disclosure
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🌾 Primary Industries & ResourcesGas, Information Disclosure, Maui Development Limited, Regulations, Pricing Methodology, Tariffs, Transmission Charges, Optimised Deprival Value, WACC, Required Return, Depreciation, Required Revenue, Tariff 1, Tariff 2, Operational Expenditure, CATIS website