The importance of metering and reducing reliance on exemptions

This case study reminds distributors of their obligation to ensure metering is installed at all network supply points (NSPs), whether new or retrofitted at older sites, to support the reliable and efficient operation of the electricity system.

Background

The electricity market relies on accurate data to operate efficiently and reliably. Accurate reconciliation of consumption and electricity flow data helps ensure consumers pay only for the electricity they use, and for the services required to deliver it.

New Zealand’s electricity networks include legacy sites that date back to early industrial activity, when asset decisions were influenced by need, access and natural features, like rivers. Some of these sites remain unmetered.

Why metering matters

Electricity meters measure the amount of electricity flowing into or out of a connection point, including network supply points, grid injection points and grid exit points. This information is used for billing, settlement and monitoring across the electricity system.

If metering is inaccurate or absent, consumers may be over‑ or under‑charged and system visibility is reduced.

The Electricity Industry Participation Code requires all metering installations to meet the accuracy standards set out in Part 10. These standards protect consumers by ensuring meters perform reliably and accurately.

Metering provides real-time data that improves network visibility, enables faster outage detection, supports event monitoring and strengthens asset and system management.

Retrofitting metering on legacy unmetered sites

Distributors often operate older network sites, that were historically left unmetered, because they were lightly used or intended only for emergency interconnection points. However, even rarely used assets can quickly become critical.

For example, recently an unmetered connection point became essential after a transformer failed elsewhere on the network. With the replacement transformer many months away, the unmetered connection was used to support reliability in case of outages. This required an exemption to avoid breaching the Code.

This example highlights the operational and financial risk associated with legacy unmetered sites.

Outdated or inadequate metered assets can:

  • complicate asset and outage management
  • reduce real-time network visibility
  • increase operational and compliance risk
  • create higher or misallocated costs if reconciliation is not accurate.

At the same time, metering technologies continue to improve and are more cost‑effective and easier to install, even in constrained or remote environments.

For these reasons, distributors should take every opportunity—especially during maintenance or renewal work—to install or upgrade metering at older unmetered sites.

Exemptions cannot be applied retrospectively and may not be granted if there are other alternatives

While exemptions may offer temporary relief, they are not a substitute for compliant metering. Installing metering supports emergency preparedness, regulatory compliance, and long-term network resilience.

The above example shows that, while metering may involve upfront cost, the operational and compliance benefits may make it a sound long‑term investment.

Relying on exemptions creates several risks, including:

  • Regulatory uncertainty - Exemptions may not be granted, may expire or may not be approved for renewal
  • Operational risk – Access to backup supply can become dependent on regulatory approval before becoming available, rather than being inherently compliant and available when needed
  • Administrative overhead - Each exemption requires preparation, justification, and may require ongoing reporting conditions eg, demonstrating materially accurate estimation methods.

What the Code says

A distributor must ensure that an NSP it is responsible for that is not a point of connection has metering in place. This means all electricity flowing through the NSP is accurately measured in line with the Code. If the distributor creates a new NSP it must either take responsibility for the metering equipment itself or arrange for another party to do so under contract and notify the reconciliation manager of the reconciliation participant within 20 business days.

The distributor must also keep the reconciliation manager informed about metering details. Within 5 business days of each meter being certified, it must provide the metering equipment provider’s ID and the certification expiry date. When a meter is re-certified, the distributor must update this information within 20 business days, including the reconciliation participant, the provider’s ID, and the new expiry date.

Clause 10.25 - Responsibility for ensuring there is metering installation for NSP that is not point of connection to grid

(1) A distributor must, for each NSP that is not a point of connection to the grid, and for which it is recorded in the NSP table on the Authority’s website as being responsible, ensure that—

(a) there is 1 or more metering installations; and

(b) all electricity conveyed is quantified in accordance with this Code:

(2) A distributor must, if it proposes the creation of a new NSP that is not a point of connection to the grid,—

(a) for each metering installation for the NSP, either—

(i) assume responsibility for being the metering equipment provider; or

(ii) contract with a person who, in that contract, assumes responsibility for being the metering equipment provider; and

(b) within 20 business days after assuming responsibility or entering into the contract under paragraph (a), advise the reconciliation manager of—

(i) the reconciliation participant for the NSP;

(ii) [Revoked]

(c) within 5 business days after the date of certification of each metering installation, advise the reconciliation manager of—

(i) the participant identifier of the metering equipment provider for the metering installation; and

(ii) the certification expiry date of the metering installation.

(3) In relation to an NSP of the type described in subclause (1), a distributor must, no later than 20 business days after a metering installation for such an NSP is recertified, advise the reconciliation manager of the following:

(a) the reconciliation participant for the NSP:

(b) the participant identifier of the metering equipment provider for the metering installation:

(c) the certification expiry date of the metering installation.