Market Brief - 19 February 2013

Market Brief

19 February 2013

Contents

• Stress tests unchanged for the April-June quarter of 2013
•
• Support for FTR participants wanting to calculate FTR rentals
•
• Recalculated reconciled levy rates for the financial year ended 30 June 2012
•
• Consultation released: loss factor methodologies
•
• Part 10 implementation: new registry available for participant’s testing
•
• Compliance Update
•
• Current consultations
•
• NZ electricity hedge contracts - 15 February 2013

Stress tests unchanged for the April-June quarter of 2013

The tests previously published on the Authority's website are the tests that will apply for the April-June 2013 quarter. There is no change from the previous quarter.

The stress-testing regime requires certain participants in the wholesale electricity market to apply a set of standard stress tests to their market position, and report the results to their Board and to an independent registrar appointed by the Authority.

Questions about the stress tests can be directed to info@ea.govt.nz. Please include 'stress test' in the subject line.

• Stress tests
• •

Support for FTR participants wanting to calculate FTR rentals

The Authority has released a tool to help FTR participants understand and assess FTR rentals calculations. FTR rentals are the portion of the loss and constraint excess that will fund the settlement of inter-island FTRs.

The Authority has made the tool available as a market facilitation measure to assist participants with interpreting a complex part of the Code relating to the valuation of FTRs.

The tool is called vSPD_FTRent. It takes inputs from the vectorised scheduling, pricing and dispatch (vSPD) model and approximates the algorithms in Schedule 14.6, which the FTR manager must use in calculating the FTR rentals. Its functionality is integrated with the vSPD model the Authority uses to model the electricity market, and is provided as an additional “Calculate FTR rentals” execution option for public users. It helps parties test the effect of different grid or pricing scenarios on the calculation of FTR rentals. Understanding how FTR rentals are affected by different grid and pricing conditions will assist participants to assess and manage the risk of FTRs potentially being underfunded.

• vSPD_FTRent tool
•

Recalculated reconciled levy rates for the financial year ended 30 June 2012

The Electricity Authority has recalculated reconciled levy rates for the financial year ended 30 June 2012.

The recalculation was carried out after it was identified that the reconciliation manager provided incorrect full year data for the 2011/12 reconciliation calculation. The error affects only distributors and the grid owner. All other levy rates and volumes remain unchanged.

Invoices and credit notes to correct the levies paid by distributors and the grid owner will be posted out today (19 February 2013). Where refunds are due, these will be paid by direct credit in the week beginning 25 February 2013.

The recalculated reconciled levy rates will be gazetted on Thursday, 21 February 2013, and are also available on the Authority website.

• Levy rates
•

Consultation released: loss factor methodologies

The Authority has released a consultation paper relating to losses of electricity in distribution networks. The consultation paper contains two proposals.

The first is a proposal to publish and monitor the updated guidelines on the calculation and the use of loss factors. The Authority is grateful to the members of the Loss Factor Review Panel for their efforts in producing the updated guidelines.

The second is a proposal to amend the definition of ‘losses’, the use of ‘losses’ and the use of related definitions in the Electricity Industry Participation Code 2010.

The Authority is seeking feedback from interested parties on the proposals, and the assumptions and analysis that underpins them. Submissions should be made to submissions@ea.govt.nz by 5pm on Tuesday, 16 April 2013.

• Loss Factor Methodologies
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Part 10 implementation: new registry available for participant’s testing

The new Part 10 registry will be available in test mode from 16 January to 22 February 2013 to assist participants to complete their own system testing prior to formal user acceptance testing (UAT) of the registry. Part 10 project contacts have been provided information on how to access the test environment and notify any issues to the Authority. If you have not received this information, please contact marketoperations@ea.govt.nz.

Compliance Update

The Authority has published its latest update on compliance matters, up until 31 January 2013.

• Compliance Update
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Current consultations

Transmission pricing methodology review; issues and proposal

The Authority is reviewing the transmission pricing methodology (TPM), which specifies the method for Transpower to recover costs of providing transmission services.

• Transmission pricing methodology review - issues and proposal.
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Started: 10/10/2012. Ending: 1/3/2013, 5pm.

Electricity Information Exchange Protocols (EIEPs) – Decisions and further consultation

The purpose of this paper is to notify participants of the Authority’s decision to confirm a number of revisions to terminology, definitions and field attributes used in the EIEPs.

• Electricity Information Exchange Protocols (EIEPs) – Decisions and further consultation
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Started: 5/2/2013. Ending: 22/3/2013, 5pm.

NZ electricity hedge contracts - 15 February 2013

Information plays an important part in building market confidence and strength.

To assist interested parties in tracking market development, the Authority publishes NZ electricity hedge contacts as a standard section of its weekly Market Brief.

ENDS

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