Future security and resilience

Future system operation: DSO models

Upcoming Open Closed Decision
View submissions Submissions closed 19 August 2025
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Decision

We published a cross-agency roadmap to support the work being undertaken by electricity distributors on distribution system operator (DSO) functions and capabilities.

This DSO roadmap summarises work underway by the following parties to facilitate the development of one or more DSOs in New Zealand:

  • Commerce Commission
  • Electricity Authority
  • Energy Efficiency and Conservation Authority
  • Electricity Engineers’ Association
  • Department of the Prime Minister and Cabinet
  • Ministry of Business, Innovation and Employment.

In July 2026, we invited stakeholders to provide feedback to help inform the final roadmap and received seven submissions.

Submitters were generally supportive of the roadmap's focus on developing DSO capabilities, improving the coordination of consumer energy resources and progressing industry collaboration on key enablers such as interoperability, network visibility, flexibility markets, data sharing, and cybersecurity.

The submissions, together with further stakeholder engagement and analysis, have informed the final roadmap and will help guide our work on distribution system operation, as well as broader future system operation initiatives.

A roadmap for the future of distribution system operation in New Zealand

Feedback

We invited stakeholders to provide feedback to help inform the final roadmap.

We received seven submissions. Submitters were generally supportive of the roadmap's focus on developing distribution system operator (DSO) capabilities, improving the coordination of consumer energy resources and progressing industry collaboration on key enablers such as interoperability, network visibility, flexibility markets, data sharing, and cybersecurity.

The submissions, together with further stakeholder engagement and analysis, have informed the final roadmap and will help guide the Authority's future work on distribution system operation and broader Future System Operation initiatives.

The feedback period closed on 30 July 2026.

Consultation

Thanks to all who provided feedback. This consultation sought submissions on three alternative models for distribution system operation (DSO) to inform our decision making and next steps.​

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

The three DSO models we proposed 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.

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

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

Consultation paper

The future operation of New Zealand's power system - Consultation paper

Submissions

Download all submissions (.zip)