Transnet National Ports Authority Tariff Application for ... Tariff...آ  transnet national ports authority

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  • TRANSNET NATIONAL PORTS AUTHORITY

    TARIFF APPLICATION FOR FINANCIAL YEAR 2020/21

  • Transnet National Ports Authority Tariff Application for Financial Year 2020/21 __________________

    Page 1 of 69

    Table of Contents 1.Executive Summary……………………………………………………………………………………………………………………….. 8

    2.Introduction………………………………………………………………………………………………………………………………… 10

    3.Legal Basis and Regulatory Requirements……………………………………………………………………………………. 10

    4.Tariff Methodology……………………………………………………………………………………………………………………… 11

    4.1Methodology for the valuation of the Authority’s RAB ................................................................... 11

    5.The Business of the Authority……………………………………………………………………………………………………… 12

    5.1Introduction ..................................................................................................................................... 12

    5.2Functions of the Authority ............................................................................................................... 12

    5.3Tariffs in Perspective........................................................................................................................ 14

    6.Port Infrastructure Development Plan and Capital Expenditure…………………………………………………… 17

    6.1Port Investment planning ................................................................................................................ 17

    6.2The Authority’s Capital Investment Programme ............................................................................. 17

    6.3Key Focus Areas of Capital Investment Program in FY 2020/21 to FY 2022/23 .............................. 18

    7.The Authority’s Total Revenue…………………………………………………………………………………………………….. 20

    7.1Real Estate Revenue ........................................................................................................................ 20

    7.2Private Sector Participation in the Port Sector (Concession Programmes) ..................................... 21

    7.3Marine Business Revenue ................................................................................................................ 23

    7.3.1The Authority’s Volumes ............................................................................................................... 23

    7.4Cargo ............................................................................................................................................... 23

    7.4.1Containers ..................................................................................................................................... 25

    7.4.2Automotives ................................................................................................................................. 26

    7.4.3Break Bulk ..................................................................................................................................... 27

    7.4.4Coal ............................................................................................................................................... 27

    7.4.5Iron Ore ......................................................................................................................................... 27

    7.4.6Manganese Ore ............................................................................................................................ 28

    7.4.7Liquid Bulk .................................................................................................................................... 28

    7.5Marine Services ............................................................................................................................... 29

    8.Tariff Application Approach…………………………………………………………………………………………………………. 31

    8.1Revenue Requirement Formula ....................................................................................................... 31

    8.1.1Regulatory Asset Base .................................................................................................................. 31

    8.1.2Weighted Average Cost of Capital................................................................................................ 33

    8.1.3Valuation of the RAB .................................................................................................................... 33

  • Transnet National Ports Authority Tariff Application for Financial Year 2020/21 __________________

    Page 2 of 69

    8.1.4Taxation ........................................................................................................................................ 34

    8.1.5Operating Costs ............................................................................................................................ 35

    8.1.6Revenue Claw-back ....................................................................................................................... 36

    8.2Revenue Requirement...................................................................................................................... 37

    8.3The Tariff Strategy ........................................................................................................................... 38

    8.3.1Asset Cost Allocations ................................................................................................................... 38

    8.3.2Tariff Book Proposal for FY 2020/21 ............................................................................................ 40

    8.4An update on clauses in the Tariff Book .......................................................................................... 42

    8.5Port Tariff Incentive Programme (PTIP) ........................................................................................... 42

    9.Port Efficiency……………………………………………………………………………………………………………………………… 43

    10.Weighted Efficiency Gains from Operations………………………………………………………………………………. 44

    11.Conclusion…………………………………………………………………………………………………………………………………. 46

    ANNEXURE A: The Authority’s Tariff Book………………………………………………………………………………………. 47

    ANNEXURE B: Capital Expenditure………………………………………………………………………………………………….. 48

    ANNEXURE C: Volumes…………………………………………………………………………………………………………………… 55

    ANNEXURE D: Operating Expenditure (“Opex”)……………………………………………………………………………… 56

    ANNEXURE E: FY 2020/21 Tariff Book Changes………………………………………………………………………………. 66

  • Transnet National Ports Authority Tariff Application for Financial Year 2020/21 __________________

    Page 3 of 69

    Tables

    Table 1: Revenue Requirement FY 2020/21 to FY 2022/23 ....................................................................... 9

    Table 2: Marine Revenue for FY 2020/21 to FY 2022/23 ........................................................................... 9

    Table 3: The Authority’s Core Functions .................................................................................................. 13

    Table 4: The Authority’s Services and Corresponding Revenue Streams................................................. 16

    Table 5: Operation Phakisa Major Projects .............................................................................................. 19

    Table 6: Strategic Capital Investment Objectives ..................................................................................... 19

    Table 7: Real Estate Salient Features ....................................................................................................... 21

    Table 8: FY 2020/21 Concession Programme ........................................................................................... 22

    Table 9: Authority’s Volume Projection ................................................................................................... 25

    Table 10: Working Capital ........................................................................................................................ 32

    Table 11: Weighted Average Cost of Capital (WACC)............................................................................... 33

    Table 12: Opening Regulatory Asset Base ................................................................................................ 33

    Table 13: R