In January 2015, we asked the system operator to review the instantaneous reserve markets. The objectives were to determine whether the current markets for fast and sustained instantaneous reserve could be combined into one single market and whether new product definitions could be introduced to replace the current products for fast and sustained instantaneous reserve.

In its report, the system operator recommended the Authority undertake more detailed economic and technical analysis on two new methods to procure under-frequency reserve:

• area under the curve—a fast instantaneous reserve product based on the average response of the instantaneous reserve provider over the first 6 seconds
• purchasing sustained instantaneous reserve on less than a 1:1 basis (the system operator currently purchases a quantity of sustained instantaneous reserve that equals the largest risk).

The system operator’s initial analysis suggests that these new methods could reduce the amount of instantaneous reserve purchased, while maintaining the electrical system reliability. 

We will undertake the work recommended by the system operator during the 2015/16 financial year.

We will also investigate the feasibility of a Scheduling Pricing and Dispatch-based solution for procuring instantaneous reserve.

• System operator report

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We have added to our EMI website a new report showing the forward price curve based on ASX futures prices. The report complements the exchange-traded settlement price and open interest reports that we published on 7 July 2015.

The forward price is calculated daily and is based on the settlement prices of all currently traded contracts. It’s a convenient way to collapse a lot of information into a single value that represents the market’s view on the value of electricity in the future. It is interesting to observe that in recent months the forward price has followed the spot price on a downward trend and has dropped by almost $10/MWh since April.

EMI users can adjust the various parameters on the report to see a range of forward price representations covering any period dating back to 14 July 2009 when ASX first started trading New Zealand electricity futures. Users are encouraged to read the notes accompanying the report where we explain the methodology and email feedback or suggestions to emi@ea.govt.nz.

• Exchange-traded forward price curves report 

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The Authority and the system operator are required under the Code to agree and publish a joint development programme (JDP) at least annually. We recently agreed updates to the programme that reflect progress, changes to priorities, and other project agreements that have occurred since the programme was last published in November 2014.  

We have published the updated programme on our website. 

Please email any questions about the programme to admin@ea.govt.nz.

• Joint development programme plan 

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We have published submissions on our Transmission Pricing Methodology (TPM) options working paper.

• Submissions

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We have published the submissions received on our consultation paper Access to tariff and connection data.

• Submissions

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Bid and offer provisions of the Code: Shortened gate closure and revised bid and offer revision provisions

We are consulting on a Code amendment to shorten gate closure and amend provisions for making bids and offers.

• Bid and offer provisions of the Code

Started: 07/07/2015; Ending: 19/08/2015 5pm

Demand response guiding regulatory principles

We welcome feedback on an information paper about demand response guiding regulatory principles. 

• Demand response information paper

Started: 11/08/2015; Ending: 23/09/2015 5pm

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