Decision paper on improving prudential security arrangements

The Electricity Authority Te Mana Hiko (Authority) has today published a decision paper to improve prudential security arrangements by:

• reducing the post-default exit period by four days for retailers with 1,000 or fewer ICPs, and
• reallocating residual funds held in the clearing manager’s operating accounts from generators to wholesale market purchasers (including retailers) on the basis of purchase volume.

In October 2025, we published an Issues and Options Paper seeking feedback on practical adjustments to improve the efficiency of wholesale prudential settings without increasing risk for the wider market.

Feedback on the issues and options paper informed our Consultation Paper, published in March 2026, which proposed two Code amendments. This decision paper now sets out the Authority’s decision on those amendment proposals.

These changes will help the electricity market run more smoothly by making it easier for small retailers to meet their prudential obligations. More resilient small retailers will provide consumers with greater choice.

The Code amendments will come into effect on 30 November 2026.

We thank all the participants who made submissions.