Update on alleged Code breach by grid owner

The Electricity Authority Te Mana Hiko (Authority) is progressing its investigation into an alleged breach of the Electricity Industry Participation Code 2010 (Code) by Transpower as the grid owner.

The alleged breach relates to Transpower’s maintenance of assets in accordance with good electricity industry practice.

The Authority alleged that the grid owner breached clause 12.113 of the Code on 20 June 2024.

This alleged breach is related to the collapse of a transmission tower that resulted in a power outage in the Northland region.

The compliance investigation is independent from the Authority’s report to the Minister for Energy on the tower collapse that was released on 25 September 2024. That report focused on understanding and explaining the cause, or causes, of the event and lessons that can be learnt in order to prevent recurrence of similar events in the future and consider the best means of promoting the reliable and efficient supply of electricity for all New Zealanders.

The announcement of the establishment of a $1 million fund by Transpower and Omexom to be allocated to Northland resilience initiatives and projects is not related to the ongoing compliance investigation.

An investigator was appointed in September to investigate the alleged breach and industry participants affected by the alleged breach were invited join the investigation. No parties have joined the investigation.

The investigator will make recommendations to the Authority, who will then decide whether to lodge a complaint with the independent Rulings Panel.

The Rulings Panel has the power to make pecuniary penalty orders up to $2 million for a breach of the Code and can also make compensation orders.

Total liability for a breach of clause 12.113 of the Code (ie, including both pecuniary penalties and compensation orders) is limited to $2 million.