The scarcity pricing regime is set out in Parts 8 and 13 of the Electricity Industry Participation Code 2010 (Code). Under that regime, if an electricity supply emergency causes forced power cuts in one or both islands, the system operator triggers scarcity pricing. Once triggered, scarcity pricing sets a $10,000 per megawatt hour (MWh) price floor and a $20,000 per MWh price cap in the trading periods affected by the emergency.

This paper outlines six operational issues with the current scarcity pricing regime, and proposes Code amendments to resolve these issues.

• Consultation paper

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The system operator has published a high-level explanation of the core modelling changes it is proposing to make to enable a national market for instantaneous reserve. 

The system operator is happy to receive questions about these changes, which it expects to implement in October 2016.

We consider that enabling a national instantaneous reserve market would promote our statutory objective by increasing competition between instantaneous reserve providers in each island. It would also reduce the quantity of instantaneous reserve procured, benefiting consumers by deferring investment in new capacity.  

Details of the changes and a contact address for questions are available on the system operator’s website.

• Modelling changes

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The Electricity Industry Participation Code Amendment (Minor Code Amendments) 2016 comes into force on 1 May 2016.

The amendments are to Parts 8 and 10 of the Electricity Industry Participation Code 2010 (Code).

• Please note that the updated version will be available from 1 May 2016
• Code amendment

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The Electricity Industry Participation Code Amendment (Removal of In-band Frequency Keeping Compensation) 2015 comes into force on 1 May 2016.

The amendment is to Part 13 of the Code.

• Please note that the updated version will be available from 1 May 2016
• Code amendment

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Exploring refinements to the spot market

We have published a consultation paper seeking views on options to improve spot pricing arrangements in the wholesale market.

• Assessment of real time pricing options in the spot market

Started: 12/04/2016; Ending 24/05/2016 5 pm

Scarcity Pricing Code amendments

We have published a consultation paper outlining six operational issues with the current scarcity pricing regime. The paper includes proposed Code amendments to resolve these issues.

• Scarcity Pricing proposed Code amendments

Started: 26/04/2016; Ending 07/06/2016 5 pm

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FTR prudential security methodology

The clearing manager has published a consultation paper that proposes a variation to the FTR prudential security methodology.

• Clearing manager’s consultation

Started: 12/04/2016; Closing 5/05/2016 5 pm

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