18 December 2018

Welcome to Market Brief, the Electricity Authority’s weekly update on regulatory and market developments.

Contents

Seasons greetings and office hours

Our office will be closed on Monday, 24 December 2018 and we will reopen on Thursday, 3 January 2019.

The Board and staff of the Authority would like to thank everyone who has participated in the Authority’s work over the past year. We appreciate the time given to submissions, informal discussions, and technical input. 

We wish you all the best for the festive season and look forward to working with you again next year.

We will publish the next edition of Market Brief on Tuesday, 15 January 2019.

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Work programme report for the four month period to 31 October 2018

We have published our work programme report for the period covering 1 July to 31 October 2018. This is a progress report against the work programme that we published in July.

The work programme and the report to 31 October are available on our website.

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Notice of decision to lay formal complaints with the Rulings Panel –
2 March 2017 South Island AUFLS event

On 4 December 2018, the Authority decided, under regulation 23 of the Electricity Industry (Enforcement) Regulations 2010, to lay formal complaints with the Rulings Panel against the system operator and the grid owner.

The formal complaints relate to a major system event on 2 March 2017 when the circuit breakers at the Twizel substation were accidentally tripped during routine testing, cutting both of the two Clyde-Cromwell-Twizel electrical circuits, and resulting in the formation of two grid islands.

The system operator and grid owner cooperated to manage and then reconnect the two grid islands. The Authority alleges that when the system operator and grid owner did this, they breached a number of Electricity Industry Participation Code (Code) provisions relating to system security, grid emergency management, and restoration.

More information is available on our website.

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The Authority can proceed with a Default Distributor Agreement

On 30 November 2018, the Court of Appeal released a partial decision on the Authority’s right to introduce a Default Distributor Agreement (DDA). The Court of Appeal’s decision allows us to proceed with our DDA proposal.

The Court of Appeal’s decision confirmed that the Code may require a particular contractual structure, require specific terms to be located particularly within that structure, prescribe some types of mandatory contractual terms, and prohibit some terms in particular circumstances.

The DDA is designed to promote competition and efficiency in the electricity industry by achieving more standardisation of contracts for distribution services.

We’re still waiting for a final decision as to whether the DDA falls within the jurisdiction of the Electricity Authority or the Commerce Commission. We will continue developing the DDA proposal in line with our statutory objective.
 

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Stakeholder briefing on proposed changes to official conservation campaigns and hydro risk curves

The Authority and Transpower are jointly hosting a briefing on our coordinated consultations that propose changes to the settings for official conservation campaigns and the calculation of hydro risk curves.

Time: 12.30–3.30 pm (with optional lunch from 12 noon)
Date: Thursday, 20 December
Location: Electricity Authority, Level 7, 2 Hunter Street, Wellington

The briefing is an opportunity for stakeholders to hear from the project teams and better understand the proposals contained within the two consultation papers.

More information, including how to register, is available on our website.

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Call for nominations for the Security and Reliability Council

We are calling for nominations for three members of the Security and Reliability Council (SRC). The SRC provides us with independent advice on reliability of supply issues, and on the performance of the electricity system and the system operator. The SRC comprises senior members of the New Zealand electricity industry, including consumers.

We are particularly interested in nominations from people who have experience in governance or management roles responsible for:

  • electricity generation, particularly hydro, wind, or thermal
  • industrial businesses, especially businesses connected directly to Transpower’s grid.

We intend to appoint the successful nominees in March 2019, for an expected term of three years.

More information is available on our website.

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Current consultations

Review of regulatory settings for Official Conservation Campaigns 

We are consulting on the regulatory settings for official conservation campaigns. This review is being co-ordinated with Transpower’s consultation on its review of the security of supply forecasting and information policy.

Started: 11/12/2018; Ending: 04/02/2019 5pm

More efficient distribution prices consultation 

We are reviewing the principles for distribution pricing to clarify our expectation that the price anyone pays reflects the costs of the electricity distribution service they are getting.

Started: 11/12/2018; Ending: 19/02/2019 5pm

Consultation calendar

Download and view our high-level consultation calendar (PDF)

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