Review of participant audit regime consultation paper published
We are proposing a number of changes to the participant audit regime (regime). These changes include clarifying the purpose of the audit regime, better aligning governance of the audit regime with international best practice as well as operational enhancements to improve the efficiency of the audit regime. The consultation proposes amendments to the Code, amendments to existing guidelines and the creation of new guidelines.
Submissions close at 5 pm on Tuesday, 22 December 2015.
Post-implementation review of multiple frequency keeping in the North Island
We have completed a post-implementation review of multiple frequency keeping (MFK) in the North Island. The review compares the costs of frequency keeping, competition in the frequency keeping market, and the performance of the power system frequency from the year before and the year after the introduction of MFK. The full review and a layperson’s guide can be found on our website.
We have completed a review of the metering market. Due to the confidential nature of the information we will not be publishing a detailed report. However, a summary can be found on our website.
Reduction in size of electricity futures and options contracts traded on ASX
ASX has reduced the contract size for ASX New Zealand electricity contracts from 1 MWh to 0.1 MWh, effective Monday, 9 November 2015.
Participants use futures and options contracts to manage spot price risk. If the contracts remained at the traditional size of 1 MWh, retailers would need to have about 1,000 customers per contract to match the cover provided by each contract. For small retailers or companies wishing to enter the market, 1 MWh was too difficult to manage.
As such, the reduction to 0.1 MWh is likely to encourage greater participation in ASX trading and increase confidence in the hedge market. This change is particularly beneficial for small retailers as it creates more opportunities to grow their businesses. In turn, we expect to see greater retail competition.
The Electricity Authority and Energy Efficiency and Conservation Authority have released a joint consultation paper on the proposed 2016/17 appropriations and their respective work programmes.
We have released a consultation paper, and a supporting companion paper, on the implications of evolving technologies for the pricing of distribution services.
