Levy

Date Published: Tue, 16/12/2008 - 16:00 Author: Glenda MacBain

 

Gas Industry Co has three sources of funding:
 


Gas Industry Levy
Annual Fee
Market Fees



Gas Industry Levy



The Gas Act provides for a levy on industry participants to fund the activities of Gas Industry Co (as industry body) pursuant to that Act. Gas Industry Co as industry body incurs the costs of:
 

  • making recommendations concerning any gas governance arrangements, including for regulations and rules under the Act;
  • establishing, operating and facilitating the operation of markets for industry participants;
  • providing advice to the Minister on matters concerning the gas industry;
  • governance of the industry body;
  • collecting the levy; and
  • carrying out any other functions or duties, or exercising any powers, under the Act.



These costs are all permitted to be recovered by Gas Industry Co through an industry levy. Further information on Gas Industry Co's forecast financial information can be viewed here .

The levy is required to be reset annually. The resetting process involves Gas Industry Co consulting with stakeholders on matters related to the levy and making a recommendation to the Minister on levy regulations for the year ahead.

For the FY2012, the levy consultation began with the release of a consultation paper in December 2010. Following consideration of submissions on the consultation paper, Gas Industry Co made a recommendation to the Minister of Energy on the FY2012 levy structure in February 2011. The Minister accepted Gas Industry Co’s recommendation, and the Gas (Levy of Industry Participants) Regulations 2011 were gazetted on 26 May 2011. The following levy structure applied from 1 July 2011:

  • a Retail levy of $5.76 per annum payable on each ICP; and
  • a Wholesale levy of 1.66 cents per GJ of gas purchased directly from gas producers during the previous month.



Copies of the December 2010 consultation paper, the February 2011Recommendation to the Minister, and the latest Levy Regulations can be accessed below:
 

Levy Consultation


Levy Recommendation to Minister


Levy Regulations 


In total, the levy seeks to recover approximately $3.963 million in FY2012 to fund Gas Industry Co's policy work and market administration (excluding external service providers and some consultants). It is estimated that $1.469 million will be recovered from the Retail levy and $2.494 million from the Wholesale levy.

Gas Industry Co does not directly charge its levies to the end consumers. The net impact to consumers from the above levies will depend on each wholesaler’s and retailer's position with regard to the levy and how much of these costs they may choose to pass on to their respective consumers. For information about the levy amount on your gas account, please contact your retailer. 

 

Annual Fee


Shareholders are required to pay an annual fee to Gas Industry Co. The Board has set an annual fee  of $10,000 (plus GST) per shareholder.

 

Market Fees

 

Section 43S of the Act provides for industry governance regulations or rules to be funded by industry participants.  Details of industry participant funding, or “Market Fees”, are set out in each of the regulations or rules to which they apply.  These are:
 
 
 
 
 
The fees are used to recover costs of external service providers and consultants.
 
It is anticipated that aAs Gas Industry Co has moveds progressively away from policy development towards policy implementation, a greater proportion of its funding will is being derived from these fees. As a consequence, it is expected that the proportion of funding derived from the annual levy will may continue to decline over time. Market fee revenue for FY2012 is estimated at $1.764 million.