WEL Networks exemption supports more solar energy generation in the Waikato

Today we approved an exemption to Part 6A of the Electricity Industry Participation Code, allowing electricity distributor WEL Networks to install two new solar power arrays and a battery storage system on their own network in the Waikato. This will provide just under 64MW worth of energy that can be stored and released into the market, as and when the region needs it most.

Under the current arms-length rules, distributors are restricted to installing generation on their networks that is 50MW or lower in capacity. The rules were put in place some time ago to protect consumers and ensure competition in the market - so that distributors did not use their position to disadvantage competing generators. We are prioritising a review of the relevant rules to ensure they encourage and support investment in the regions.

Encouraging and enabling investment in local electricity generation is critical to building regional resilience. Considering and processing exemptions to the Code is a way that the Authority can enable market participants to invest in solutions that benefit electricity consumers (but would otherwise fall outside the current regulatory environment) and to test these investments and opportunities in the real world.

WEL Networks has demonstrated that their plans for more distributed generation on their network will facilitate a redistribution of power away from reliance on a central grid, towards better community and regional control with increased consumer agency. The Electricity Authority is actively working to support this, to build a secure and resilient, accessible and efficient energy system that improves long-term outcomes for businesses, consumers, and New Zealand.

Read the decision paper.