The review examined dry year risk management during 2008, and identified options to improve the security of supply policy. The review was completed in December 2008 and the Review of 2008 Winter report made a number of recommendations including:

  • Ensure that suppliers face the cost of any forced demand curtailment (power cuts) and then discontinue the Reserve Energy Scheme or modify it to ensure that the costs are targeted to the parties that benefit from its use;
  • Alternatively, introduce a compulsory dry year insurance regime;
  • Review the operation and cost efficiency of Whirinaki Power Station. If moving the station or changing its fuel supply is desirable, transfer it out of the Reserve Energy Scheme to facilitate this;
  • Define and publish plans and triggers for emergency measures the Commission may take in a dry year;
  • Determine whether 'informal' information improvements adopted in winter 2008 should be formalised;
  • Improve risk disclosure around suppliers' risk positions and ability to supply;
  • Consider whether the Commission can provide more certainty about the terms of resource consents for 'emergency' generation resources that refer to the Commission;
  • Further clarify the roles of the Minister of Energy and Resources and the Commission relating to security of supply;
  • Increase the Commission's independence in the exercise of its regulatory functions; and
  • Place priority on initiatives that promote competition.

The recommended actions made within the Review of 2008 Winter have been incorporated into the Market Development Programme.