Invitation to Comment: Draft Security of Supply Forecasting and Information Policy

Closing date for comments on 5pm 4 February 2019

Transpower has conducted a review of the Security of Supply Forecasting and Information Policy (SOSFIP), the current version of which was last updated in 2013.  This review has focused on the treatment of contingent storage (hydro storage that is available to respective hydro generators only under emergency conditions to mitigate a risk of shortage), in response to specific requests for its consideration from some industry participants following the 2017 security of supply event.

We propose that the SOSFIP be changed so that contingent storage is included in the Hydro Risk Curve (HRC) assessment, where we reasonably believe that the contingent storage will be operationally available. Recognising the inter-dependency between the hydro risk levels and Official Conservation Campaign (OCC) to mitigate a risk of supply shortage, the Electricity Authority (Authority) is running a parallel consultation and review of the OCC start- and stop-triggers.

Our proposal is to amend the SOSFIP to include contingent storage when determining the risk of shortage. This is notionally a simple exercise, as we only need to quantify the amount of contingent storage available and add this to the amount of controlled storage. However, this has some implications for the feasibility of the HRC assessment, the ability to easily convey the meaning of the HRC assessment to stakeholders, and how and when contingent storage is accessed.  As such, we are proposing some accompanying changes in how we present the information.

While the most significant policy changes we are proposing are related to the inclusion of contingent storage in the HRCs, we are also proposing several smaller changes to the SOSFIP, notably:

  • Publication timing of the annual security of supply assessment
  • Publication timing of hydro storage projections
  • Which hydro resources we include in our assessment and clarification of under what circumstances we would include additional resources
  • Removal of Winter Energy Margin and Winter Capacity Margin methodology as this is duplicated elsewhere
  • Extending the reach of gas supply disruptions to include all thermal fuels
  • Rationalisation of terminology and other minor amendments to improve clarity and readability

As the content of this consultation is complex, Transpower and the Electricity Authority will be holding a number of industry presentations and workshops during the consultation period to assist participants in understanding the outcome of the two reviews. The first of these will be held following the Electricity Authority’s Regulatory Managers meeting on 20 December 2018. More sessions will be scheduled in January 2019.

 

The following documents are available for your information/comment:

SOSFIP Consultation Document December 2018 [ pdf 2.8 MB ]

Submit your feedback

We invite interested parties to submit their feedback on our proposals by 4 February 2019, to system.operator@transpower.co.nz with the subject line “SOSFIP Review 2018”. Unless otherwise advised all submissions will be treated as non-confidential and will be published on the Transpower website following the closing of this consultation.