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Transmission Agreements

Transmission Agreements are the contracts between transmission customers and Transpower. Transpower and its designated customers are obliged to enter into Transmission Agreements for provision of transmission services (clauses 12.8 - 12.25 of the Code). The Authority is required to propose an appropriate structure for these Transmission Agreements (clauses 12.5 - 12.5 of the Code). In the event an individual Transmission Agreement is not signed, the default Benchmark Agreement applies. The Connection Code is appended to the Benchmark Agreement or Transmission Agreement. This page contains information about the Benchmark Agreement for connection to, and use of, the transmission grid. It contains information about the agreement and its formation, and is targeted primarily at industry participants.

All parties that are physically connected to the transmission grid are required to have an agreement with Transpower. These parties are known as designated transmission customers, and include distribution companies, major users that are directly connected, and generation companies. The categories of designated transmission customers are set out in clause 12.1 of the Code.

Transpower and its designated customers are obliged to enter into Transmission Agreements for provision of transmission services. This may be an individual transmission agreement or the default “Benchmark Agreement”. Part 12 of the Code requires the Authority to develop a Benchmark Agreement for connection to, and use of, the grid. The processes and requirements are set out in clauses 12.4-12.48 of the Code. The Benchmark Agreement itself is appended to the Code in clause 12.31(5) and (6). 

The Benchmark Agreement provides a basis for negotiation of individual commercial agreements between Transpower and its customers, and also acts as a default transmission agreement when one has not been established. Any individual Transmission Agreement entered into by Transpower and a designated customer must either be consistent with the Benchmark Agreement or approved by the Authority (if it is satisfied certain conditions are met). In the event there are disputes between Transpower and its customers regarding the various aspects of the Transmission Agreements which are not resolved within a reasonable time, either party can refer the matter to the Rulings Panel which has discretion to determine the dispute.

The Benchmark Agreement must also be consistent with the grid reliability standards (GRS). If, while a Transmission Agreement applies, Transpower becomes aware that a connection asset is not expected to continue to meet the GRS, a process for upgrade of assets or amendment to the agreement must be entered into. 

The Benchmark Agreement was developed by the Electricity Commission in consultation with industry. As required under the Code, it includes technical obligations, information provision obligations, payment obligations, and service definitions, service levels, and service measures. It can be amended in accordance with the process set out in part 12.

While connection services and interconnection information services are included in the Benchmark Agreement, the interconnection rules are set out within the Code.  These are often referred to as the Interconnection asset services and can be found in clauses 12.99-12.118 of the Code.

The development process included several consultations, and extensive input from industry participants, the Commission’s Transmission Advisory Group (since disestablished), legal and technical advisers. 

There are two key documents appended to the Benchmark Agreement (or individual Transmission Agreement):

• The Connection Code, which sets out the technical requirements and standards for designated transmission customers and Transpower.
• The Outage Protocol which specifies the circumstances in which Transpower may temporarily remove or reduce the capacity of any grid assets which are otherwise required to be provided under the Benchmark Agreement and Interconnection rules. It also provides for procedures and policies for Transpower to plan for and carry out outages, and the management of unplanned outages on the grid.

This page is related to: Transmission.

Back to top Last updated on 8 August 2011