Looking ahead – price-quality resets for electricity distribution sector
Published18 Dec 2018
2019 is shaping up to be a big year in our regulation of the electricity distribution sector, with 5-year price-quality paths due to be reset for 17 regional electricity lines companies and grid operator Transpower.
Default Price-Quality Path for electricity lines companies
In October we sought feedback on the potential issues we will be considering when resetting the price-quality paths that will apply to 17 lines companies. To ensure these monopoly lines companies provide reliable service to consumers – and are limited in the prices they charge – we set the maximum prices and minimum quality standards they must meet. The current quality standards are focused on ensuring that consumers on each network do not experience more frequent or longer outages relative to historical levels. For this reset, we are interested in hearing from customers on whether the current quality standards best reflect their expectations. We are also exploring whether other aspects of quality might also be regulated. For example, we could include in the quality standards the notification period lines companies provide customers for planned outages or their response times to consumer calls.
A copy of the consultation paper can be found here.
Submissions close on 20 December 2018 and cross-submissions are due 31 January 2019.
We are aiming to have our draft decision out in May 2019 and a final decision by November 2019. We will also be holding workshops in late February/early March to discuss priority issues following feedback from submissions on the consultation paper.
Transpower’s price-quality reset
We are seeking early views on our proposed process, framework and approach for setting national grid operator Transpower’s next price-quality path. Transpower’s price-quality path sets the total amount of money it can collect from its customers and the minimum standards of quality it must deliver in return. We want Transpower’s customers to help shape its proposed approach to evaluating Transpower’s proposals on expenditure and quality as it collects almost $1 billion a year from its customers, who pass these costs on to consumers and businesses. It’s important all stakeholders have a chance to be heard and help us shape our approach as we begin this process. We particularly want to hear from gentailers, lines companies, major electricity users and consumer groups on the approach we intend to take in assessing Transpower’s proposals on expenditure and quality. We also want their views on our longer-term vision to encourage Transpower to improve on its asset management and customer engagement practices over time.
Transpower’s formal proposal and independent verifier’s report can be found here.
Further information on the Commission’s process paper, including submission timeframes, can be found here.