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Powering up on agenda

Regulator seeks views on regulatory priorities for New Zealand’s energy networks and international airports.
Posted on 10 May, 2021
Powering up on agenda

The Commerce Commission has published an open letter to canvass views on how it should prioritise its regulatory work programme.

The aim is to help the energy and airport sectors address upcoming issues, including the country’s transition to a low-carbon economy and managing continuing impacts of Covid-19.

Responses will inform its regulatory work as it seeks to provide certainty to businesses while delivering long-term benefits for consumers under part four of the Commerce Act.

“As a result of changes aimed at reducing emissions, the energy sector is facing anticipated growth in demand for electricity,” says Sue Begg, the commission’s deputy chairwoman. “At the same time, there is a potential reduction in demand for gas.

“Recent draft advice to the government from Climate Change Commission outlining a decarbonisation pathway may accelerate the pace of that change.

“We are at a pivotal moment for the energy sector. The expectations of consumers, businesses and government are changing, and the industry needs to meet them – especially around decarbonisation, the switch to alternative fuel sources, and adopting new technologies and business models.”

Begg, pictured, adds the coronavirus has had a sustained impact on our major international airports in Auckland, Wellington and Christchurch. Their views on how to manage ongoing pressures and position themselves to respond post-pandemic will help the regulator to shape its position on future regulation.

“We want feedback from those with an interest in the energy and airports sectors as we set our programme to ensure regulation is fit for the future and delivers the right outcomes for New Zealanders.”

The commission is particularly interested in feedback relating to the following areas:

• The seven-yearly statutory review of underlying regulatory rules and processes for electricity lines companies, gas pipeline businesses and those three major international airports. Its intention is to formally start this review in 2022.

• The five-yearly reset of price-quality paths, which will set the maximum revenues and minimum standards of quality that gas pipeline businesses must comply with. The regulator aims to start by publishing an issues paper around this July.

• A targeted review of requirements for lines companies to provide information about their performances. There is no due date for such a review. But the commission will consider aspects relating to decarbonisation and preparations for the next reset of the price-quality paths for electricity lines companies.

The open letter is available on the regulator’s website. Feedback is due by 5pm on May 28.

Under the Commerce Act, the commission regulates monopolies, including electricity and gas networks, and international airports, to ensure they deliver strong and sustainable services to benefit consumers.

Its price-quality regulation sets rules about how much regulated businesses can earn from customers and the minimum reliability standards they must deliver.