New Zealand Gazette – 2006 – No. 123

Page 3635

✨ Electricity Market Policy



30 OCTOBER 2006
NEW ZEALAND GAZETTE, No. 123

Electricity Commission, Transpower should allocate the relevant FTRs to the agent.¹³ FTR recipients should be able to refuse an allocation.

13

Recipients of allocated FTRs should be able to put their FTRs into an auction and assign reserve prices in accordance with the process developed by the Electricity Commission. In this case, they should receive the value assigned to those FTRs by the auction (subject to the price exceeding the reserve). If the value assigned by the auction does not exceed the reserve price, the original recipient should retain the FTR.

14

Transpower should pass any excess FTR auction income (auction income not paid to those who put allocated FTRs back into the auction), residual rentals (rentals not utilised in the FTR market) and any income received as payment for an FTR allocation, less appropriate expenses, to those that pay Transpower’s charges for sunk and new investments.

15

A distribution company should pass through rental-related or FTR-related cash flows to the distribution company’s customers, retailers, and/or end users. The pass through should be transparent, should not discriminate between parties in a like position, and should as far as possible be non-distortionary. It should be consistent with the guiding principles for an FTR market, and in particular have due regard to promoting competition between retailers.

16

Distribution companies should be able to recover reasonable costs relating to their role under this policy statement.

Design issues

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Design options considered by the Commission should specify (inter alia):

i The nodes to which FTRs should be allocated;

ii The methodology for offering an allocation of FTRs to distribution companies and Transpower’s direct connect off-take customers;

iii Whether particular customers who pay for the sunk costs of specific assets should also be offered an allocation of FTRs relating to that asset;

iv The price, if any, to be paid for an FTR allocation;

v The hub or hubs (or a methodology for determining the hub or hubs) from which allocated FTRs will be defined;

vi A mechanism for approving the appointment of an agent by a distribution company;

vii Methodologies for passing through rental-related and FTR-related cash flows from distribution companies to the distribution companies’ customers, retailers, and/or end users;

¹³ Subsequent references in this policy statement to distribution companies should be read as applying also to an agent appointed by a distribution company to manage the distribution company’s role under this policy statement.



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Online Sources for this page:

VUW Te Waharoa — PDF NZ Gazette 2006, No 123


Gazette.govt.nz — PDF NZ Gazette 2006, No 123




✨ LLM interpretation of page content

🌾 Financial Transmission Rights Policy Framework (continued from previous page)

🌾 Primary Industries & Resources
Energy, Electricity Market, Transmission Rights, Government Policy