Hedge Market Development: Enhancing trading of hedge products – consultation paper
The Hedge Market Development project is a high priority project that supports our statutory objective by encouraging competition in both the wholesale and retail markets.
As part of this project we have now published a consultation paper on proposed enhancements to the trading of hedge market products, with an emphasis on developing the trading of ASX exchange traded products.
We are seeking submissions to inform the development of a further consultation paper, which we expect to publish in late 2015, that will make firm proposals and include a detailed CBA for the enhanced trading of hedge products.
Proposals covered in this consultation paper include:
encouraging greater liquidity in existing ASX baseload products
the introduction of, and the promotion of, trading in ASX half-hourly settled price cap products
publication of market-making metrics
creating firmer market-making arrangements for existing products.
Submissions should be submitted by 5pm on Tuesday, 21 July 2015.
Published: Sharing sustained instantaneous reserve across the HVDC link information paper
We are proposing the system operator introduces a facility to share sustained instantaneous reserve across the High Voltage Direct Current inter-island link. Enabling and using such a facility would promote our statutory objective by reducing the quantity of sustained instantaneous reserve procured and increasing competition between instantaneous reserve providers in each island. This initiative is an interim step for the project to implement a national market for instantaneous reserve.
We have published an information paper seeking feedback on our proposal to enable and use this facility.
Submissions published: Transpower’s proposed variation to the Transmission Pricing Methodology
We have published submissions on our consultation on Transpower’s proposed variation to the Transmission Pricing Methodology (TPM), which arose out of Transpower’s recent operational review of the TPM.
Code amendment: Consumers’ access to consumption data
We have amended the Code to require retailers to provide consumers’, or a consumer’s authorised agent, with their electricity consumption data. This is a consumer-focused initiative intended to promote competition in the retail market by making it easier for consumers to use their consumption data to make decisions about their retailer and retail tariff options.
Consumers are more likely to actively and effectively participate in New Zealand’s retail electricity market, thereby improving retail competition, if they can easily access useful information. Retail competition will be enhanced as electricity retailers and providers of energy services compete more vigorously for consumers’ business. In turn, improved retail competition will increase the incentives on retailers and energy services companies to deliver innovative products and services and to seek operational efficiency gains.
The amendment is part of a programme of work called the Retail Data Project.
The Code amendment comes into effect on 1 February 2016. In order to implement this Code amendment, we have developed three electricity information exchange protocol (EIEP) formats and a procedures document to support the standardised exchange of data. The formats and the procedures document are regulated under the Code and also come into effect on 1 February 2016. We have developed these documents with the input of a technical working group, the standing data formats group, and a two week general consultation. We have compiled the summary of submissions on the general consultation and published these on our website.
For any questions or queries relating to the formats or the procedures document, please email marketoperations@ea.govt.nz.
Published: Third quarter 2014/15 work programme report
We have published our third quarter report against the 2014/15 work programme. This report provides an overview of progress across all of our projects listed in the work programme for the year.
More detail is available on specific website pages for most of the projects covered in this report.
Stress test scenarios unchanged for the July-September quarter of 2015
Stress test scenarios unchanged for the July-September quarter of 2015
The stress test scenarios previously published on our website will apply for the July—September 2015 quarter; there is no change from the previous quarter. The stress-testing regime requires certain participants in the wholesale electricity market to apply a set of standard stress tests to their market position, and to report the results to their Board and to NZX (the independent registrar appointed by the Authority).
Questions about the stress tests can be directed to info@ea.govt.nz. Please include 'stress test' in the subject line.
The Electricity Industry (Levy of Industry Participants) Regulations 2010 (Levy Regulations) have been amended. The Electricity Industry (Levy of Industry Participants) Amendment Regulations 2015 do two things:
Update the Levy Regulations to reflect the introduction of Part 14A of the Electricity Industry Participation Code 2010. This amendment comes into force on 30 June 2015 and applies to the levy payable for the 2014/15 financial year.
Replace the Customer Switching Fund levy activity that was payable by retailers, and that was limited to costs incurred by the Crown from 1 November 2010 to 30 April 2014, with a new Consumer Participation Operations levy activity, effective from 1 July 2015. This new levy activity will also be payable by retailers. It applies to costs incurred by the Authority of promoting to consumers the benefits of comparing and switching retailers, and other activities that seek to facilitate consumer participation in electricity markets. The change thereby re-establishes, on a more enduring basis, a consumer specific levy activity that is payable by retailers. This amendment comes into force on 1 July 2015 and applies to the levy payable for the 2015/16 financial year.
Annual levy rates for the year ending 30 June 2016
We have calculated the annual levy rates for the financial year ending 30 June 2016 in accordance with regulation 7 of the Electricity Industry (Levy of Industry Participants) Regulations 2010. The calculations include the impact on the levy arising from the amendments discussed above.
We will gazette the annual levy rates on Thursday, 11 June 2015, from which date they will also be available on our website.
Reconciliation participant forum: Registrations close Friday 12 June
We will hold a reconciliation participant forum at Cliftons, 100 Willis Street, Wellington on 23 June 2015, starting at 9.00 am.
The forum includes a workshop session to discuss operational issues and problems. Participants may suggest additional topics to be discussed.
If you are interested in attending the forum, please email your name, contact details and any additional topic requests to marketoperations@ea.govt.nz with ‘June 2015 reconciliation participant forum’ in the subject line. Please note that the venue size means we may have to limit the number of people per organisation who can attend.
Transmission Pricing Methodology: Update on release of options working paper
As previously advised, we will release a Transmission Pricing Methodology (TPM) options working paper for consultation on Tuesday, 16 June 2015. The consultation period will run until Tuesday, 11 August 2015.
We will be releasing the options working paper through Market Brief. This will be distributed at 10am on 16 June.
We are also holding an initial stakeholder briefing on this working paper. The briefing will be held from 10am – 11.30am on Tuesday, 16 June at The Wharewaka, Odlins Square, 15 Jervois Quay, Wellington Waterfront. We intend to live stream the briefing and then make this available in video format via our website. If you would like to attend the briefing in person, please email conference@ea.govt.nz with ‘16 June TPM stakeholder briefing’ in the subject line.
We will also arrange one-on-one meetings with parties who request them, and will convene more detailed workshop sessions. The workshop sessions will be held in Auckland, Wellington, Christchurch and Invercargill in late June and early July. Details of the workshop sessions will be notified in a future issue of Market Brief.
Information plays an important part in building market confidence and strength.
To assist interested parties in tracking market development, the Authority publishes NZ electricity hedge contracts as a standard section of its weekly Market Brief.
