In 2016, we released an asset disposals policy, as part of our Final Report on our 2016 review of Sydney Water’s prices.
Central to our policy is the principle that we will remove the regulatory value of an asset from a business’s RAB, when that asset is sold or disposed of.
In 2017, Sydney Water sought clarification on the definition of ‘sale value’ in our policy where we reference ‘sale value’ as a proxy for (or to estimate) regulatory value. Specifically, Sydney Water asked whether sale value was net of the costs incurred in selling an asset, including sale and remediation costs, where applicable.
We consulted on this by releasing an Issues Paper in September 2017.
We have now considered submissions to that Issues Paper, and have updated our asset disposals policy accordingly.