51 ―
6. Revenue 6.1 Revenue from contracts with customers
2020 $M
2019 $M
672.5
Regulated networks – sale of distribution services Regulated networks – third party contributions
685.6
85.7
79.0
256.4 203.9
Gas trading sales Metering services
284.1 186.9
75.5
Other Total
83.0
1,294.0
1,318.6
Revenue streams
Satisfaction of performance obligation
Regulated networks – sale of distribution services
The group receives revenue from business customers and energy retailers who sell energy to end customers for electricity and gas distribution services in Auckland.
Revenue from electricity and gas distribution services is measured at the value of consideration received, or receivable, to the extent that pricing is measured by the regulator within a def ined revenue path. Revenue is recognised over time on a basis that corresponds with end consumers’ pattern of electricity and gas consumption. Customers are billed monthly in arrears for distribution services, measured in units of electricity and gas distributed. Revenue from distribution services therefore includes an accrual for services provided but not billed at the end of the month. The accrual is determined based on the group’s estimate of volume distributed in the month using the most recent data available. A large portion of the contract assets at balance date consists of this accrual. Third party contributions are recognised as revenue over time, reflecting the percentage completion of the underlying construction activity. The group recognises a contract liability to account for consideration received from the customer but where the agreed construction activity is not completed; and conversely a contract asset is recognised to account for activities completed not billed. The transaction price for third party contributions is netted against estimated rebates payable to commercial customers. A contract liability is recognised to account for payments received from customers for construction activities completed but who are eligible for rebates in the future based on completion of developments. In the event that a contract combines a contribution towards an agreed construction activity with sale of electricity or gas distribution services, the group unbundles the contract into two performance obligations and recognises revenue in accordance with each obligation’s accounting policy.
Regulated networks – third party contributions
The group receives contributions from residential and commercial customers towards the construction of distribution system assets in the Auckland electricity or gas distribution networks.
Notes to the Financial Statements
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