WACC PARAMETERS FOR THE NETWORK SERVICES IN THE ELECTRICTY SECTOR
FOR 2008-2010 REGULATORY PERIOD
Index Electricity Transmission Electricity Distribution
WACC rate (simplified) 5.00% 5.00%
WACC type nominal post-tax nominal post-tax
Nominal risk free rate not used not used
Debt premium not used not used
Equity market risk premium not used not used
Asset beta not used not used
Equity beta not used not used
Gearing not used not used
Cost of debt not used not used
Cost of equity not used not used
Tax rate 15% 15%
Projected inflation rate not used not used
Asset base* net book value of fixed assets of end net book value of fixed assets of end
2002 + capital expenditure2002- 2002 + capital expenditure2002-
2010 - regulatory depreciation2002- 2010 - regulatory depreciation2002-
2010 - disposal 2002-2010-customer 2010 - disposal 2002-2010-customer
contributions2002-2010 contributions2002-2011
Comments:
Information about the methodologies Law on Electricity and the Law on Electricity and the
employed to calculate the various Methodology of the transmission Methodology of the transmission
parameters and distribution price caps and and distribution price caps and
tariffs calculation tariffs calculation
Information concerning the
According to the mentioned According to the mentioned
calculation and the updating rules of
documents the normative profit documents the normative profit
the WACC rate
rate calculated on the value of rate calculated on the value of
property used in the service property used in the service
provider’s licensed activities each provider’s licensed activities each
year of the regulatory period shall year of the regulatory period shall
be not less than the weighted be not less than the weighted
arithmetic average of the annual arithmetic average of the annual
percentage interest rate at 10-year percentage interest rate at 10-year
maturity GS auctions held during maturity GS auctions held during
the last 36 calendar months, but the last 36 calendar months, but
not higher than 5 percent. Updated not higher than 5 percent. Updated
every 3 years every 3 years
Network regulation incentive-based incentive-based
Length of the regulation period 3 years 3 years
Note: * - since 01/01/2010