The Commerce Commission has today released input methodologies for the default price-quality paths that apply to electricity distribution services and gas pipeline services.

The input methodologies concern the valuation of assets, allocation of costs and treatment of taxation. The Commission already specified these input methodologies for customised price-quality path proposals and information disclosure regulation in December 2010.

Input methodologies are the upfront rules, processes and requirements for services regulated under Part 4 of the Commerce Act.

The Commission was directed to determine these input methodologies by the High Court following an appeal by Vector Limited in September 2011. At that time, the High Court also directed the Commission to determine a stand-alone starting price adjustment input methodology. On 1 June 2012 the Court of Appeal decided that this was not required.

There are two upcoming processes for default price-quality paths in which these input methodologies are relevant: setting the initial default price-quality path for suppliers of gas pipeline services; and a potential one-off reset of the default price-quality path for electricity distribution services. The Commission is consulting on these processes separately.

Copies of the input methodologies are available at http://www.comcom.govt.nz/additional-input-methodologies-for-electricity-and-gas-dpps/.