Commission receives application for EIR Act exemption from Top Energy Limited
Published21 Dec 2006
The Commerce Commission has received an application from Top Energy Limited, seeking exemption from section 17 of the Electricity Industry Reform Act 1998 (EIR Act) in relation to its proposal to expand its geothermal power plant Ngawha, near Kaikohe.
Presently, Ngawha has a nameplate capacity of 12 MW. The EIR Act provides a statutory exemption for an electricity lines business to own or operate certain geothermal power plants with a nameplate capacity of up to 12 MW. Top Energy's proposal is to expand Ngawha by up to 30 MW to result in a new nameplate capacity of up to 42 MW.
Top Energy Limited is an electricity lines business which owns and operates the local distribution network in the Northland region.
Section 17 of the EIR Act prohibits the cross-involvement of electricity lines and supply companies.
Background
The purpose of the EIR Act is to reform the electricity industry:
to better ensure that costs and prices in the electricity industry are subject to sustained downward pressure;
to ensure the benefits of efficient electricity pricing flow through to all classes of consumers; and
by effectively separating electricity distribution from generation and retail and promoting effective competition in electricity generation and retail markets.
The Commission may grant an exemption only where doing so:
a. would not result in certain involvements in electricity lines businesses and electricity supply businesses which may create incentives or opportunities:
i. to inhibit competition in the electricity industry; or
ii. to cross-subsidise generation activities from electricity lines businesses; and
b.would not result in relationships between electricity lines businesses and electricity supply businesses which are not at arms length.
