Future system operation: DSO models

We are seeking feedback on three alternative models for distribution system operation (DSO) to inform our decision making and next steps.​

Our consultation paper considers the expected capabilities and functions needed from electricity distributors, the system operator, aggregators, and/or various third parties.

The three DSO models we are putting forward are:

• Model 1: Total TSO model - The transmission system operator (TSO) is solely responsible for coordinating real-time dispatch. Distributors have a limited role in this model. Effectively, the TSO is the DSO.
  
• Model 2: Hybrid model - Coordination of real-time dispatch is shared between the TSO and one or more distributors-as-DSOs. Both the TSO and distributor/s have significant DSO responsibilities.
  
• Model 3: Total DSO model - One or more distributors-as-DSOs are responsible for coordinating real-time dispatch. The transmission system plays a supporting role in this model, but effectively one or more distributors are the DSO.

We prefer Model 2, the hybrid model, as this is likely an efficient and reasonably affordable model and would likely facilitate the uptake and connection of distributed energy resources for the benefit of consumers. However, we are considering all proposed models equally and would like to encourage all interested people and parties to submit their feedback on this consultation.

This consultation follows on from our discussion paper Future operation of New Zealand’s power system which sought feedback on several potential issues that could impact future system operation.

We welcome your feedback on this consultation by 5pm, Tuesday 19 August 2025.

We held a one-hour webinar on Thursday 24 July to talk through the three key issues highlighted in our issues and options paper and answer questions. Watch the webinar