Chorus’s base capital and operating expenditure

Cost escalation factors
Eilya Torshizian
We provided advice on the cost escalation indices relevant to Chorus’s cost categories, including network Operating Expense (OPEX), IT Capital Expense (CAPEX), network electronics, greenfield expansion, poles CAPEX, network sustain, building and services, physical network, site lease and fibre lease. The outputs were used for Chorus's RPE1 submission. Our report was informed by the information provided by engineers and the stakeholders on the composition of cost factors. We provided advice on the available data and methodologies to provide robust projections and forecasts of the impact of COVID-19 disruption. This was particularly a challenging project because this was the first submission of Chorus and identifying the precise indices for predicting cost factors was critical.