DRAFT [NO.]: [Date] Marked to show changes from draft [No.]: [Date] Examination of the current test for the regulation of gas pipelines APA Submission to Dr Vertigan’s Consultation Paper 19 October 2016 APA Submission to Dr Vertigan’s Consultation Paper Contents 5 Pricing of non-firm services are not too high 27 The ACCC claim 27 PART A – EXECUTIVE SUMMARY 4 ACCC’s examples of pricing services over the benchmarks 27 1 A critical consultation 4 Quantum of revenue from non-firm services is small 28 Shippers currently have access to non-firm services 28 The context 4 The ACCC’s evidence base has not been tested 4 6 ACCC assertions on capital cost recovery and subsequent The ACCC has not established the benefits of a change 6 pricing 29 What are the costs of regulation? 7 The ACCC claim 29 Is the current coverage test fit for purpose? 9 Summary of APA position 29 The ACCC’s Proposed Test 9 Competitive industries charge based on new entrant costs 29 Case for change has not been made 11 Impact on investments in new pipelines 29 Structure of this submission and attached reports 13 Distortion of the efficient operation of existing pipelines 30 PART B – THE ACCC CLAIMS 14 PART C – IMPACT ON GAS PRICES 31 2 The broader context 14 7 CEG Pricing Report 31 The gas transmission pipeline industry 14 ACCC assertions 31 Pipeline operators have invested 15 CEG analysis 32 Pipeline tariffs have not increased in real terms 15 Why have pipeline charges not increased? 16 8 Independent analysts reports 34 What the ACCC says about this evidence 17 Morningstar analysis 34 3 How does the ACCC support its proposed changes? 18 J.P. Morgan analysis 35 The ACCC inquiry 18 PART D – COSTS OF REGULATION 36 How did the ACCC base its claim of monopoly pricing? 18 9 What are the costs of regulation? 36 4 RORs for incremental projects 20 Regulation has costs 36 ACCC claim 20 Adverse impact on investment 36 ACCC relies on selected projects 20 Adverse impact on innovation 40 ACCC has used the wrong comparator 20 Does the 15 year access holiday mitigate this risk? 43 IRRs are typically higher for incremental investments 21 Summary 43 The regulated return is not an appropriate benchmark 21 SWQP case study 25 30253978_7 PART E – THE CURRENT COVERAGE TEST 45 14 Glossary 59 10 What does the coverage test need to do? 45 ATTACHMENT A – Responses to questions in consultation paper 61 What does the coverage test need to do? 45 ATTACHMENT B – ACCC comments relating to APA 69 How does the current test work? 45 ACCC’s Proposed Test 46 Current coverage test is sound 47 Current coverage criteria can apply to monopoly pricing 47 Current coverage criteria can be satisfied by non-vertically integrated service providers 47 Competition and efficiency are inextricably linked 48 Coverage decisions do not support reform to criterion (a) 49 11 ACCC scenarios can satisfy criterion (a) 50 Criterion (a) can apply 50 Scenario A 50 Scenario B 51 Scenarios C and D 51 PART F – THE CASE FOR CHANGE 53 12 Case for change not made 53 Overview 53 Importance of consistency between NGL, Part IIIA and the CCA 53 Costs of adopting the ACCC’s Proposed Test 54 Benefits do not clearly outweigh the costs 56 13 Where to from here? 57 Improving efficiency 57 Industry has led change 58 30253978_7 DRAFT [NO.]: [Date] Marked to show changes from draft [No.]: [Date] PART A – EXECUTIVE SUMMARY  an analysis of whether the changes will achieve the desired policy objectives; and 1 A critical consultation  having regard to the above, an independent assessment of whether the The context case for change is established. This submission responds to the Consultation Paper, “Examination of the This submission considers each of these points. In Attachment A, we current test for the regulation of gas pipelines”, dated 4 October 2016. specifically answer the questions put by the consultation paper. APA welcomes this consultation by Dr Vertigan on what are the appropriate APA does not believe that the ACCC has established a case to justify such settings for the coverage criteria under the National Gas Law (NGL). It far reaching and bespoke regulation. involves a critical policy decision on how the pipeline industry should be regulated with implications for other infrastructure in Australia. The ACCC’s evidence base has not been tested The Australian Competition and Consumer Commission (ACCC) is seeking The background to this consultation is the ACCC’s report on the East Coast the hurdle represented by the coverage criteria to be lowered. Further, it Gas Inquiry (ECGI Report). The ACCC asserts that a large number of suggests consideration be given to having transmission pipelines deemed to pipeline operators have been engaging in monopoly pricing. This is critical be regulated from the outset1 and the onus of proof reversed so that to this entire consultation and the case for change. pipelines have to prove they should not be regulated.2 Much of the ECGI report is valuable and provides clarity on the issues The change in coverage criteria would represent a fundamental change of involved. Unfortunately, the main findings of the report in relation to pipeline the approach to regulation of pipelines which has been in place for 20 years pricing are based on misinterpreted evidence or findings that have been and which has underpinned billions of dollars of investment. It would also be inferred from examples presented out of context. APA and other pipeline a rejection of the approach to access regulation under Part IIIA and the operators were not informed of, or given an opportunity to respond to, these recent Productivity Commission review and the “root and branch” Harper findings before publication. The ACCC’s evidence base needs to be tested Review findings in the Competition Policy Review: Final Report released in as part of this consultation to determine if it supports the findings. March 2015 (Harper Review). It would impose an untested bespoke regime which is out of step with access regulation for other infrastructure. Specifically, the ACCC relies on three assertions to support its findings of monopoly pricing. These are discussed below. APA operates a mix of fully regulated, light regulated and unregulated assets. It does not dispute the need for regulation or that full economic APA rejects ACCC’s assertion that rates of return on incremental regulation of assets may be appropriate in certain circumstances. However, projects are excessive a fundamental regulatory change must be based on: Most of the projects cited involve small capital works projects to APA  proper evidence; pipelines (representing less than 1.25% of APA’s enterprise value). Three of the projects were developed as a competitive response and the other three  an understanding of the benefits and costs of the change; involved making pipelines bi-directional. The ACCC cites rates of return (RORs) from Board papers without providing context, namely that the ROR of a small capital project which takes no account of the very large underlying 1 ECGI Report, p 140. 2 ECGI Report, p 139. 30253978_7 4 capital investment in the pipeline itself will axiomatically give rise to a high earn revenue in excess of the regulated rate of return where they outperform ROR. cost and demand benchmarks, or tariffs which are struck through competitive processes to build pipelines or price services (such as occurred To compound the perception issue, the ACCC makes an “apples v oranges” with the CGP). comparison which has the effect of making the project returns appear to be twice as high as they should be against their chosen comparator. Finally, the ACCC approach is inconsistent with how existing pipelines would be valued if they became regulated. If the capital base of the CGP was ACCC incorrectly finds pricing non-firm services are too high determined today for the purposes of regulated pricing under the NGL, it would be hundreds of millions of dollars and certainly not zero. It is The ACCC set out some arbitrary benchmarks for the pricing of non-firm misleading for the ACCC to suggest otherwise unless the ACCC also services and then sought to compare pipeline prices to these. Even so, the intends to bring in a new approach which expropriates all revenue above a ACCC identified only three instances of pricing of services that did not meet shadow regulated return on previously unregulated or light regulated the ACCC’s benchmarks. Each relate to APA’s pipelines. Two are isolated pipelines. APA can say with some confidence that this approach would instances of historical pricing. The other meets the benchmark as the ACCC devastate future pipeline investment. used the wrong forward tariff to do its calculation. For context, and as provided to the ACCC during its Inquiry, APA’s east coast pipeline revenue The evidence is weak from all available and interruptible services (not just these 3 examples) in H1 FY16 is less than 0.5% of its total annual revenue in the East Coast. To provide context, the ACCC, under its information gathering powers, had access to all APA documents and communications, and investigated over APA rejects ACCC’s assertions on capital cost recovery and 300 contracts and variations from APA alone as part of its Inquiry. It also subsequent pricing required APA to provide communications (including emails, board papers, notes, reports and so on) between APA senior commercial staff and its The ACCC makes the assertion that two pipelines are charging prices where executive over a two year period. The ACCC spent one year looking at the the cost of construction of the pipeline has already been recovered and documents provided, interviewing pipeline operators and market participants which are higher than those that would apply if those pipelines had been under oath, and investigating market pricing outcomes. regulated. It claims this to be the case for the Carpentaria Gas Pipeline (CGP). The ACCC appears to hold the belief that prices in any competitive Despite this degree of analysis, the ACCC ‘found’ very few examples on market would be almost zero where capital was fully paid off. This is not the which to base its claims of monopoly pricing by pipeline operators. In most case. In a workably competitive market, an income producing asset would cases the ACCC resorts to making claims, inferences and assertions based not be charged at almost zero pricing. Just because the capital costs of an on marginal expansion projects, minor revenue items (non-firm services), old office building have been recovered does not mean tenants are only and economically flawed claims in regard to “fully paid off” assets to support charged outgoings. The ACCC’s incorrect belief leads it to undertake an a wholesale change to regulation of the pipeline sector. analysis which effectively assumes monopoly pricing to make its finding that pipeline operators are monopoly pricing. Part B of this Submission provides a detailed review of the material relied upon by the ACCC and Attachment B provides a response to the specific More concerning for APA is the way the ACCC calculated the prices if the issues raised by the ACCC in relation to APA’s pipelines. asset were regulated. It assumes all revenue above what it considers to be an appropriate regulated level of return must be monopoly profit and then APA has also included with this submission a report by Competition uses that approach to show that there is monopoly profit. The ACCC does Economists Group (CEG), “Returns on Investment for Gas Pipelines”, which not even attempt to reconcile this approach with the incentive regulation analyses the approach of the ACCC in reaching its findings on monopoly approach that actually applies to covered pipelines which allows shippers to pricing (CEG Returns Report). 30253978_7 5 The ACCC has not established the benefits of a change transport cost is reduced by half, it now means it has become economic for Queensland LNG buyers to buy gas in the south at $7.50, thereby raising The ACCC proposition is wrong the price for southern buyers to $7.50. The ACCC asserts that high transport charges on some pipelines can affect The evidence shows that gas flows are increasingly flowing north. APA can gas prices in the southern states even for users that don’t directly utilise confirm that it has signed a number of gas transportation agreements those pipelines. In particular, it claims that (as illustrated by Table 6.2 of the (GTAs) to move gas north. It is also evident that the market is contracting ECGI Report) reducing transportation charges by 10% to 50% could lead to for northern gas flows given that the Moomba to Adelaide Pipeline System a $0.20 to $1.02 difference in the maximum price payable by domestic users (MAPS) has become bi-directional and can now flow north, the Eastern Gas in the southern states. Pipeline (EGP) has expanded to allow greater northern flows and the Moomba to Sydney Pipeline (MSP) has become bi-directional to allow flows The ACCC does not provide a formal economic analysis for its conclusion. north. The ECGI Report itself noted that over $450M of pipeline investments APA engaged CEG to prepare a formal economic model to test the ACCC’s had been made to enable more gas to flow from Victoria to New South assertion. This is provided by CEG in its report, “Transport Costs and Wales and up to Queensland.3 Domestic Gas Prices” (CEG Pricing Report), and included with this submission. Part C of this submission sets out that analysis. This highlights that there are real issues with the ACCC’s analysis and that it is overly simplistic (as discussed below). The crux of the ACCC’s claim is that gas prices in Queensland are set by liquefied natural gas (LNG) netback prices and the prices in southern states Note that the two independent research analyst reports reached the same are set by reference to Queensland prices with the difference in prices conclusion: between the two dependent on transportation costs. The ACCC assumes that prices in the southern states equal the LNG netback price plus the cost This represents an increase on what the customer was paying of transporting gas from Queensland and therefore any reduction in previously, with the benefits of lower transmission costs accruing to transport costs will lead to a “one for one” reduction in prices in southern the gas producer. While this is just one potential scenario, cutting states. pipeline returns is not the clear-cut win for domestic gas customers that it appears at first blush. (Morningstar Equity Research)4 ACCC analysis incomplete as with northward flows, southern prices would increase …in the situation of the buyers alternative, reduction in tariffs can switch the dominant pricing consideration to a netback price and As CEG shows, the ACCC’s analysis is dependent on which way gas is create a spike in gas prices for Southern users. (J.P. Morgan)5 flowing. If gas is flowing north, then on the ACCC’s approach the price in the southern states must be less than the LNG netback price less ACCC model requires GBJV market power or a cartel transportation costs (or otherwise it is more profitable to sell in the south). In this scenario, lowering transport costs would raise southern prices, e.g. if How then does the ACCC reach a conclusion that prices will reduce when the LNG netback price is $8/GJ and the transport costs are $1/GJ and gas their own economic framework suggests they will increase? The ACCC flows are northward, then the southern price for gas must be equal to or less than $7/GJ or otherwise it would be more profitable to sell in the south. If 3 ECGI Report, p 93. 5 J.P. Morgan, Asia Pacific Equity Research, “Australian Domestic Gas, Cost inflation to drive 4 Morningstar Equity Research, “APA Group: Caught in the ACCC's Crossfire, Greater wholesale gas prices up in all Eastern States”, 10 May 2016, pp 62-64. regulation is a headwind to longer-term returns”, 14 June 2016, pp 11-13. 30253978_7 6 assumes that southern gas markets are not competitive and the Gippsland In its post-ECGI Report communications, the ACCC focuses on the 50% Basin Joint Venture (GBJV) is charging: reduction in pipeline tariffs and the claimed $1/GJ price reduction.6 It justifies this position on two points. First, it says older pipelines which have  Queensland customers - the LNG netback price less transportation recovered its costs on the ACCC analysis should only be charging operating costs to Queensland for northern flows; and costs (which is very low). However, neither the SWQP nor MSP is one of the pipelines that the ACCC claims to be “fully recovered”. Second, it relies  Southern customers – the LNG netback price plus an amount equal to on a one sentence comment in Appendix 3 of a 60 page Board presentation the transportation costs to Queensland (as Queensland gas is their only to calculate that the SWQP is earning revenue 70% above what it would alternative and they would have to pay transport costs to have it earn if it was regulated. To provide context, the particular page was delivered). addressing regulatory risk and was highlighting that the long term contracts mitigated against the future risk of regulation as represented by the “back of This requires GBJV to have a high degree of market power. CEG consider the envelope” assessment included. this question and finds this assumption questionable. Even if it did, a strategy by GBJV to reduce output to increase prices is unlikely to be profit Importantly, given the context, the assessment was made was using the maximising for GBJV and contrary to the evidence which shows GBJV sales regulated rate of return applying in 2015 (~6%), not that which was applying to be at record levels. The other alternative is that the GBJV and the in 2008 and 2009 during the Global Financial Crisis (GFC) (~10.5%) and southern producers are in a cartel or undertaking coordinated conduct in the used an 80 year depreciation profile rather than one linked to the remaining southern market but there is no suggestion of this in the ECGI Report. life of the gas fields (which is significantly shorter). It also used rough expenditure estimates with only notional allocation of corporate costs. The ACCC model is simplistic and not reliable The key point, however, is that it is not legitimate to compare revenue In reality, the ACCC’s analysis is overly simplistic. It assumes that LNG calculations using today’s rate of return with contractual rates stuck at a producers will switch gas to and from LNG exports depending on the different time (at the height of the GFC) and that were commensurate with domestic prices in southern states. The LNG plants represent over $60B of what would have been the prevailing regulatory rates of return imposed at infrastructure and with long term offtakes – they are designed to run as close the time. as possible to capacity and will not be left idle for gas to be moved to the domestic market. It is likely that there will be a wide range of differentials Further, the ECGI Report itself recognises that the SWQP tariffs were set in between the Queensland price and LNG netback prices. a competitive process and the “prices and other terms and conditions in these foundation contracts suggest AGL and Origin both benefited from this The other fundamental issue is that the ACCC bases its $0.20 to $1.02 competition”.7 difference on average transport costs on the South West Queensland Pipeline (SWQP) and MSP. However, the SWQP is under long term take or On what basis then should these tariffs be halved? pay contracts – for contracted shippers transportation is a sunk cost. The driver for those shippers is the marginal cost of transporting gas (i.e. the very What are the costs of regulation? low variable, throughput cost) between Queensland and southern states, not The ECGI Report recognises that the pipeline industry has made significant the average cost. The transport differential is much less than the ACCC investment ($900M in recent years) and offered more innovative services in suggests. 6 Mr Rod Sims, Speech to the South East Asia Australia Offshore & Onshore Conference, 7 ECGI Report, page 97. Darwin, 15 September 2016. 30253978_7 7 response to changing demands.8 We have a regime that is providing the The above contrasts with recent unregulated builds for the Reedy Creek right incentives in this regard – there is no question that any of the pipeline and Moomba bypass which have been agreed commercially in very investments have been gold plated or unnecessary. short times to meet immediate demand. The ACCC seeks to lower the threshold in the coverage criteria to provide An interesting case study is to compare the SWQP expansions with what for more regulation of pipelines. It is well understood, including by the has happened in the coal industry. In APA’s view, the SWQP would not ACCC,9 that regulation can impact on the incentives to invest and innovate. have been expanded in the timeframes which occurred if it was regulated and would have left eastern Australia without an essential piece of Adverse investment impacts infrastructure linking Queensland to the southern states during this critical period in the lead-up to commissioning of the $60B LNG projects. It would APA has undertaken investments in both unregulated and regulated also remove the incentive for APA to have created additional capacity from pipelines. Part D of this submission provides a number of case studies and operating SWQP in conjunction with its other pipelines. The SWQP examples of two key impacts of regulation, namely: expansion meant that there was capacity, availability, reliability and flexibility to support the trebling of gas demand with no infrastructure bottlenecks. In  delaying investment – an example includes the well documented contrast, the failure to expand coal terminals during the mining boom led to inability for APA to get regulatory approval for the expansion of the an estimated $5.5B in lost coal exports.10 South West Pipeline from the regulator leading to it being delayed for over 4 years until the next regulatory period, despite there being Adverse innovation impacts demand for the expanded services well before that time. APA has invested heavily to run its portfolio of assets as an integrated grid  providing an incentive to size pipelines only to existing demand – an to enable it to gain efficiencies and provide new services. This has included example includes the expansion to the Victorian Northern Interconnect significant IT investment and creating an Integrated Operations Centre where the regulator sought to ‘optimise’ the investment by only thinking replacing 5 control rooms. This allows combined operations of its pipelines about how to meet existing demand. Using this shorter term focus, it and the colocation of operations and commercial staff to integrate customer reduced the requested capital for the project by substituting an services and demands into real time operations. approach that would mean that future expansion of the pipeline would make the optimised solution redundant. Demand for additional capacity The Brattle Group11 has quantified the following which could not have been has since doubled within the regulatory period that the optimised achieved without taking a “grid” approach to planning and operations: solution was approved. APA was left in a difficult position as to whether it built the approved project in a staged approach that meant that later  efficiency savings of $110M in reduced capital expenditure and $7M in expansion would make part of that investment redundant, or to pursue operations cost; the more efficient (but more expensive for lower demand levels) project and risk that the regulator considered this to be inefficient.  new park and loan services having an economic benefit of $7.5M and $25M annually; and 8 ECGI Report, pp 94-95. APA alone has invested well over a $1B on capital projects in the 10 Brian Robins, NSW coal bottleneck costs $5b in exports (1 July 2008) Sydney Morning last 5 years. Herald <http://www.smh.com.au/news/national/nsw-coal-bottleneck-costs-5b-in- 9 ECGI Report, p 137. exports/2008/06/30/1214677946060.html>. 11 The Brattle Group, Benefits and Costs of Integration in Transmission / Transportation Networks: An Application to Eastern Australia Gas Markets (2016). 30253978_7 8  between $10.5M and $35M in avoided costs through storage services whether the service provider has an ability and incentive to exercise market provided during LNG commissioning. power. This has been referred to by the NCC as a “…necessary (although not sufficient) condition’ of satisfying the test.”12 The second limb is to This does not include the benefits to customers in having one contract consider the effect of access or increased access on competition in a covering multiple pipeline routes and the improved risk allocation for dependent market. customers in not having to take pipeline-on-pipeline risks. In Part D, APA provides some detail on why it would have had no incentive to do this, and This approach is reflected in the attached opinion of N J Young QC and C M the above efficiency gains would not have materialised, if all its pipelines Dermody (Young QC Opinion) in which they conclude the inquiry under the were regulated. current criterion (a) test involves an assessment of whether there is: Is the current coverage test fit for purpose?  “an ability and incentive to exercise market power (by charging monopoly prices)”; and What is its purpose?  “any use of that market power in [a] way [that is] likely to adversely The objective for economic regulation of gas pipelines should be the affect competition in a dependent market” – such that access (or enhancement of economic efficiency. Regulation should only occur where it increased access) would promote a material increase in competition in maximises net benefits for the community as a whole. That is, where the that dependent market.” total economic benefits of regulation exceed the costs. Therefore, the ability and incentive to exercise market power and the In the context of economic regulation of gas pipelines, that efficiency consequent impacts on competition in dependent markets are the critical objective is embodied in the National Gas Objective (NGO). The focus of considerations in the application of criterion (a). the coverage criteria and, in particular, criterion (a) on a material promotion of competition in dependent markets, is consistent with the framework The ACCC’s Proposed Test embodied in the Competition and Consumer Act and National Access Regime, that competition is the vehicle through which efficiency objectives The ACCC’s Proposed Test are achieved. The link between efficiency and competition is explored further below. The new test proposed by the ACCC (ACCC’s Proposed Test) has two limbs: How does the current test work?  does the pipeline have substantial market power and is it likely that the Under the National Gas Law (NGL), all the coverage criteria must be pipeline will continue to have substantial market power in the medium satisfied for a pipeline to be subject to economic regulation. The issues term; and raised by the ECGI Report relate to criterion (a) which requires “that access (or increased access) to pipeline services provided by means of the pipeline  coverage “will or is likely to contribute” to the National Gas Objective. would promote a material increase in competition in at least one market”. How then do the two limbs of the ACCC’s Proposed Test compare to the It is well established by the National Competition Council (NCC), the coverage criteria? In APA’s view, the ACCC’s Proposed Test is a Competition Tribunal and the Courts that in applying criteria (a), consideration must be had of two limbs. The first limb is consideration of 12 NCC, Declaration of Services: A Guide, February 2013 at para 3.43. 30253978_7 9 reformulation of criterion (a) with the remainder of the coverage criteria Competition and efficiency are linked effectively discarded. The ACCC’s proposed test is based on replacing a competition assessment The market power limb with one that focuses on the NGO (which focuses on efficiency) directly on the basis that the former is not sufficient. The first limb of the ACCC’s Proposed Test involve essentially the same assessment as the first limb of the current criterion (a). APA notes that The ACCC considers criterion (a) uses competition as a proxy for efficiency labelling the ACCC’s Proposed Test as the “Market Power Test” label may but competition and efficiency are not synonymous - the assessment of incorrectly imply that the current test does not also consider market power. competition impacts in dependent markets does not necessarily capture efficiency gains in those markets which are unrelated to competition. (It The ACCC’s concern is that criterion (a) is not designed to address provides four scenarios to demonstrate this which we consider in more detail monopoly pricing, particularly where the businesses involved are not below.) vertically integrated. However, as HoustonKemp explains it is a “fundamental underlying principle However as noted above criterion (a) clearly takes into account market of economics that competition and efficiency are inextricably linked. The power. The Young QC Opinion concludes on the basis of decided coverage incentives that encourage firms to compete with one another are the same determinations by the NCC and judicial decisions in the Tribunal and Federal as those that encourage firms to operate and price efficiently. All else equal, Court, “no difficulty arises in applying criterion (a) to monopoly pricing in a decision on whether or not to regulate the price of an input product cannot either its present form or in the form set out in the Exposure Draft.”13 promote one in the absence of promoting the other.”14 It is also incorrect, both as a matter of law and economics, to suggest the Further, as noted in the Young QC Opinion, “[c]riterion (a) in Part IIIA is current test cannot apply to non-vertically integrated operators – it has done directed at improving the conditions or environment for competition, in order so in the past. The propositions are also inconsistent with the views of both to achieve the objects of Part IIIA which include the promotion of the the Hilmer Committee and Productivity Commission. economically efficient operation of, use of an investment in the infrastructure by which services are provided. That is, competition is not a proxy for The NGO limb economic efficiency, rather economic efficiency is achieved through improved conditions for competition…[The] same analysis applies to There are two primary differences between this limb and criterion (a). First, criterion (a) in the NGL, i.e., criterion (a) treats the promotion of competition it replaces a competition based assessment with a vague efficiency based as the relevant means of achieving the national gas objective.”15 test. Second, it lowers the threshold to be satisfied. Each of these points is discussed below. The framework of relying on competition as the mechanism through which efficiency objectives are achieved is embodied in well-established principles consistent across the competition provisions in Part IV of the Competition and Consumer Act 2010 (Cth) (CCA), the National Access Regime and the current coverage test in National Gas Law. The ACCC’s proposed test 13 Young QC Opinion [26]. 15 Young QC Opinion [29 and 32]. 14 HoustonKemp, Economic review of proposed amendments to the gas pipeline coverage criteria: A report for APA (13 October 2016) p 5. 30253978_7 10