New dispensation scheme for Part 6A of the Code

The Electricity Authority has amended the Electricity Industry Participation Code 2010 (Code) to introduce a new dispensation scheme for specified persons who are subject to Part 6A of the Code.

Part 6A contains rules relating to the separation of distribution from certain generation and retailing (referred to as the ‘arm’s-length rules’). These rules apply to industry participants as well as ‘specified persons’, who are not industry participants but who are involved in both classes of industry participant that are subject to the arm’s-length rules.

We have urgently amended the Code to enable specified persons to apply to the Electricity Authority for a dispensation from the obligation to comply with Part 6A of the Code. This addresses an area of uncertainty that has been identified following the passing of the Electricity Industry Amendment Act 2022 (Amendment Act), which moved the arm’s-length rules from the Act to Part 6A of the Code.

Before the Amendment Act was passed, a specified person would have been able to seek an exemption from the arm’s-length rules under section 90 of the Act. Now that the arm’s-length rules are in the Code, the Authority can only grant exemptions to industry participants under section 11 of the Act. Introducing a Part 6A dispensation scheme would ensure that specified persons can be treated in the same way as industry participants, and as others in a similar position who had earlier obtained an exemption under section 90 of the Act.

The urgent Code amendment will expire after nine months. A proposal to make a permanent Code amendment is included in a consultation paper released today on Code Review Programme number 5.

About the Part 6A dispensation scheme.