64 above. The extent to which the capex forecast is referable to arrangements with a person other than the DNSP that do not reflect arm's length terms We have had regard to whether any part of Endeavour Energy's proposed total forecast capex or our alternative estimate that is referable to arrangements with a person other than Endeavour Energy that do not reflect arm's length terms. We did not identify any parts of Endeavour Energy's proposed total forecast capex or our alternative estimate that is referable in this way. Whether the capex forecast includes an amount relating to a project that should more appropriately be included as a contingent project We have had regard to whether any amount of Endeavour Energy's proposed total forecast capex or our alternative estimate that relates to a project that should more appropriately be included as a contingent project. We did not identify any such amounts that should more appropriate be included as a contingent project. The extent to which Endeavour Energy has considered and made provision for efficient and prudent non-network alternatives We have had regard to the extent to which Endeavour Energy made provision for efficient and prudent non-network alternatives as part of our assessment of the capex associated with the non-network capex driver. We discuss this further in Appendix A. Any relevant final project assessment report (as defined in clause 5.10.2 of the NER) published under clause 5.17.4(o), (p) or (s) There are no final project assessment reports relevant to Endeavour Energy for us to have regard to. Any other factor the AER considers relevant and which the AER has notified Endeavour Energy in writing, prior to the submission of its revised regulatory proposal, is a capex factor We did not identify any other capex factor that we consider relevant. Source: AER analysis
The above figure shows that sub-transmission lines represent a small proportion of total network line length. Ausgrid has the greatest proportion of sub-transmission lines - representing 10.6% of the network. Endeavour Energy reported a value of 10.1% and Essential Energy 7.9%. The average proportion of Victorian and South Australian sub-transmission lines was 5.4%. This suggests that relative to the comparison firms, ActewAGL has a cost advantage. However, ActewAGL's size and the voltage of its subtransmission system may offset this. Being a relatively small service provider, ActewAGL may not be able to achieve the same economies of scale that the larger comparison firms may be able to in their subtransmission networks. Additionally, ActewAGL's subtransmission network is exclusively 132kV, while in general the subtransmission networks of the comparison firms are 66kV. These things in combination may offset the advantage of having less subtransmission, relative to the comparison firms. Backyard reticulation Backyard reticulation is a description for the ACT practice of running overhead lines along the rear property boundaries in urban residential areas. This practice was halted in favour of undergrounding a number of decades ago, but there remains a legacy of backyard reticulation lines many ACT suburbs. Backyard reticulation is only applicable to low voltage overhead lines in the ACT. Typically the pole line is run in parallel with the adjoining property boundaries of the residential properties. This keeps the overhead lines from being viewed from the street and was considered to increase the visual amenity of the suburb. ActewAGL has identified backyard reticulation as an operating environment factor that is likely to affect their benchmarking results. ActewAGL considers that backyard reticulation increases their replacement capex. ActewAGL has reported a total network length of 5,088km. Table D2 shows the proportion of backyard reticulation of this network. Table Proportion of backyard reticulation Network component (circuit length) (km) Proportion (%) ActewAGL Total network 5,088 ActewAGL overhead network 2,394 47%