Review of regulatory settings for Official Conservation Campaigns (OCCs)

The Electricity Authority (Authority) has decided not to remove the provision for South Island-only official conservation campaigns (OCCs). This is following a survey of industry participants in 2019, as part of the Review of regulatory settings for official conservation campaigns (OCCs) and the security of supply forecasting and information policy (SOSFIP) projects. We will not amend Part 9 of the Electricity Industry Participation Code 2010 (Code).

The Authority considered removing the provisions for South Island-only OCCs by using section 39(3)(b) of the Electricity Industry Act 2010 (the Act). This section of the Act allows the Authority to amend the Code if we are satisfied on reasonable grounds that there is widespread support for the amendment among the people likely to be affected by it. We have listened to stakeholder feedback. While the majority of stakeholders that responded did support the removal of South Island-only OCCs, we were not satisfied that that the respondents were adequately representative of the parties who were affected by this change, and therefore could not be satisfied that there is widespread support.

We appreciate the time participants took to give feedback. We may consider looking at this question again in future, through the standard Code review process, as priorities allow. In the short term the Authority is concentrating our resources on responding to issues arising out of the COVID-19 pandemic and lockdown, and on key projects with widespread industry interest and the opportunity to realise considerable net benefits.

It has also been helpful for the Authority to test the widespread support mechanism under section 39(3)(b) of the Act. We will look to use this mechanism again in appropriate circumstances.

An official conservation campaign (OCC) is when Transpower (as the system operator), in accordance with clause 9.23 of the Code, asks consumers to voluntarily reduce their electricity usage. OCCs can be triggered for the South Island only or for the whole country. Earlier this year we asked stakeholders for their broad opinions on whether it is appropriate to have these two types of OCCs.

We believe there is a case to remove provision for South Island-only OCCs, and are now inviting stakeholders to tell us whether they agree. Please respond to this survey to tell us your opinion.

In light of submissions we have already received on this issue and provided we are satisfied there is widespread support for the change, we may then use our power to amend the Code without any further consultation.

We have completed our review of the arrangements for official conservation campaigns (OCCs) and today we are releasing our decisions. We have also approved the system operator’s proposal to replace the Security of Supply Forecasting and Information Policy (SOSFIP).

Changes to Part 9 of the Code and the replacement SOSFIP will be gazetted this week, and go live from 1 August 2019. This follows a consultation period which ran December 2018 – February 2019. Our key decisions are to count contingent hydro storage in relation to OCCs and retain the 10% and 8% trigger points (respectively) for starting and stopping OCCs.

The new SOSFIP is incorporated into the Code by reference.