✨ Electricity Commission Security of Supply
3614 NEW ZEALAND GAZETTE, No. 123 30 OCTOBER 2006
40 To establish the need for additional reserve energy (see below), the Electricity
Commission should look out 3 to 5 years in more detail (given consent and
construction timelines for new capacity), collect information, develop a
baseline that makes assumptions about what known projects are likely to
proceed, and identify any ‘shortfalls’ year by year. The need for additional
reserve energy should be based on dry year risk taking into account prudent
assumptions about availability of other plant.
Security of supply policy
41 The Electricity Commission should develop, consult on and publish a security
of supply policy. The security of supply policy should specify the steps that the
Commission will take at various stages during a contingent event such as an
extended dry sequence. It should also include its procurement policies for
reserve energy. The overriding objective is to give as much certainty as
possible to the market.
42 The Commission should develop and publish an operational security of supply
standard, possibly expressed as a loss of load expectation.
Minimum Hydro Zone
43 To help ensure security of supply, the Electricity Commission should develop
and publish a minimum hydro zone giving its estimate of minimum hydro
storage levels required at different times of the year to avoid the risk of
shortages in a 1 in 60 dry year. This minimum zone should take into account
the expected availability and use of thermal generation. The minimum hydro
zone should not be catchment-specific but should be national or based on
regions defined by likely transmission constraints during a dry hydro period.
44 The Commission should consult with interested parties in developing the
minimum hydro zone.
45 Within this minimum zone, the Electricity Commission should have a second
zone that would trigger a conservation campaign, on the basis that there is a
significant probability that we are in a worse than 1 in 60 dry year event.
Good processes
46 In developing and operating its security of supply policies, the Commission
should:
• put in place good consultation processes
• ensure a high level of transparency and stability of policy settings
• avoid ad hoc and discriminatory interventions
• put in place and publish protocols to manage potential conflicts between
its roles as a participant in the market as a contractor for reserve energy
and as a regulator.
Reserve energy
47 The Government wants the Electricity Commission to contract for reserve
energy (generation and contracted demand response) to provide additional
security of supply beyond the level achieved by the ordinary market. This will
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2006, No 123
Gazette.govt.nz —
NZ Gazette 2006, No 123
✨ LLM interpretation of page content
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Security of Supply Objectives for the Electricity Commission
(continued from previous page)
🏛️ Governance & Central AdministrationElectricity, Security of Supply, Reserve Energy, Hydro Management, Dry Year Risks, Policy Development, Operational Standards, Minimum Hydro Zone, Conservation Campaign, Consultation Processes, Transparency, Stability, Market Interventions, Reserve Energy Contracts