Otahuhu substation diversity proposal - history
- Transpower's application (December 2006)
- Process and Timeline (December 2006)
- Opportunity for comment (February 2007)
- Reasons for decision (May 2007)
- Requesting a public conference (May 2007)
- MEUG request for information
- Final decision (August 2007)
- Judicial Review by MEUG (March 2008)
This application was submitted as a reliability investment and as a supplement to the September 2005 Grid Upgrade Plan (GUP).
In December 2006, in accordance with rule 13.2 of section III of part F, the Commission agreed a timetable for consultation and approval of the Otahuhu Substation Diversity Proposal (Proposal). The timetable provided for the Commission to issue a notice of intention in April 2007, and to publish reasons for the decision in mid-May 2007.
Despite the endeavours of Transpower and the Commission, this timetable was unable to be met. On 15 May 2007, the Commission and Transpower agreed to an updated process and timeline.
Under rule 13.3.2 and rule 13.3.5 of section III of part F of the Electricity Governance Rules 2003, on 22 December 2006, the Commission gave notice that it was providing designated transmission customers and parties affected by the Proposal with an opportunity to:
- provide written comments on Transpower's Proposal; and
- request that the Commission consider alternatives to Transpower's Proposal.
Comments and/or requests were sought by the Commission by midday on Monday 12 February 2007.
On 25 May 2007, in accordance with rule 15.1 of section III of part F of the Electricity Governance Rules 2003, the Commission published a notice of its intent to approve Transpower's Proposal.
The document below presents the Commission's analysis of the Proposal and explains the reasons supporting the Commission's intention to approve the Proposal.
- Reasons for decision updated 29 May 07
Note: Omission in heading of paragraph 8.2 corrected
The Commission was assisted in its decision-making by analysis of the information provided by Transpower undertaken by its staff and a number of advisors.
Reports by the Commission's advisors include the following:
- Review of the Capital Costs Estimates for Transpower's Proposal of 11 December 2006, Parsons Brinckerhoff Associates (PBA), May 2007;
- Review of Transpower's Proposal Otahuhu Substation Diversity Project, Connell Wagner, 28 March 2007;
- Effect of Directly Cabling from Brown Hill Road to Penrose, bypassing Otahuhu, System Studies Group NZ Ltd (SSG), 2 April 2007;
- Otahuhu Substation Diversity Project: Review of the Circuit Breaker Configuration Proposed by Transpower, PBA, May 2007
Under rule 15.2 of section III of part F of the Electricity Governance Rules 2003, a designated transmission customer, an authorised representative of parties substantially affected by the Grid Upgrade Plan, or Transpower, may, within 10 working days of the date of publication of this notice (that is, by 5.00pm, Monday 11 June 2007), request that the Commission hold a public conference to provide a final opportunity for comment on the reliability investment to which this notice relates.
If no request to hold a public conference is received, or if the Electricity Commission determines not to hold a public conference, the Electricity Commission's decision, as set out in its notice of intention, is final.
Public conference and briefing (June 2007)
Within 10 business days of the publication of the notice of its intention, the Commission received under rule 15.2 of section III of part F of the Electricity Governance Rules 2003 three requests for a public conference and the Commission agreed to hold a public conference.
Requests for a public conference were received from the following parties:
The purpose of the public conference was to provide a final opportunity for comment in relation to Transpower's Proposal.
To assist greater understanding of the reasons for the Commission's decision, as set out in the notice of intention to approve the Proposal, the Commission held a Public briefing on the Otahuhu Substation Diversity Proposal in Wellington on 27 June 2007
Request for comments
On 29 June 2007 the Commission invited interested parties (whether intending to present at the conference or not) to provide written comments on the Proposal and the Commission's decision.
Four comments were received.
A public conference on the Otahuhu substation diversity was held in Wellington on 23 July 2007.
- Major Electricity Users' Group
- New Zealand Institute of Economic Research
- Strata Energy
- Norske Skog Tasman
- Rio Tinto Aluminium NZ Ltd
- Genesis Energy
On 11 June and 11 July 2007, the Major Electricity Users' Group (MEUG) requested the Commission provide further information in respect of the Otahuhu Substation Diversity Project under the Official Information Act (OIA). In the interests of parties preparing for the public conference on 23 July 2007, the Commission made this information available to all stakeholders.
- 11 June 2007 MEUG letter
- 6 July 2007 Commission response
- 11 July 2007 MEUG letter
- 18 July 2007 Commission response
The Commission decided (by a majority) to confirm its decision to approve the Proposal.
The document below sets out the reasons for the Commission's decision (by majority) to confirm its approval of Transpower's Otahuhu Substation Diversity Proposal.
In November 2007, MEUG initiated judicial review proceedings, alleging that the Commission had wrongly interpreted and applied clause 4.1 of the grid investment test in schedule F4 of section III of part F of the Electricity Governance Rules 2003, failed to consider other viable alternatives, and wrongly assessed the reliability benefits arising from the avoidance of high impact, low probability events.
In a decision announced on Friday 14 March 2008, the High Court rejected all three grounds of a judicial review brought by MEUG in respect of the Commission's decision on Transpower's Otahuhu Substation Diversity Proposal.
In the decision issued on Friday 14 March 2008, the High Court endorsed the Commission's approach to interpreting clause 4.1 of the grid investment test. The Court also found no reviewable error in the alternatives adopted by the Commission or in the Commission's approach to analysing high impact, low probability events at Otahuhu.
MEUG appealed the High Court's decision on Otahuhu to the Court of Appeal at a hearing held on 15 October 2008. In a judgment on 5 December 2008, MEUG's appeal was dismissed.
This page is related to: Transmission.