Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 


New Report On Mandatory Electricity Hedge Market

Friday, 22 March 2002

Energy Minister Pete Hodgson today released a report on the viability of a mandatory hedge market for electricity.

The Ministry of Economic Development commissioned Dr John Small of Auckland University to report on:

- whether generators should be forced to offer tradable hedges;

- if so, what minimum offer requirements should be imposed; and

- what mechanisms would be required to facilitate the emergence of a secondary market in hedges.

In his report Dr Small concludes that a form of net hedges should be considered for introduction to create a more efficient hedge market in New Zealand.

Mr Hodgson has sent copies of the report to the chief executives of the five major electricity generator-retailers seeking their comment. The Government has not yet formed any conclusions on Dr Small’s findings.

“I am releasing this report to promote discussion on the issues surrounding mandatory hedging,” Mr Hodgson said. “Although it says a form of net hedging might be beneficial, it also raises significant issues that would need to be addressed before such a regime could be implemented.”

Hedges are fixed price contracts that insure buyers and generators against volatile spot market prices. They can also enable retailers to compete for more customers.

Mr Hodgson warned the electricity industry after a review of its performance last winter that the Government would consider measures such as mandatory tendering of hedges if the level of retail competition did not improve. He met the chief executives of the five major electricity generator-retailers on March 6 and asked them to report back in a month on the steps they would be taking to improve competition, and on the regions in which they would be operating.

“I remain concerned that retail competition is not as effective as it should be and this report is a clear signal to the industry that mandatory tendering of hedges will be seriously considered if there is not a significant improvement,” Mr Hodgson said.

Copies of Dr Small’s report are available on the Ministry of Economic Development website (www.med.govt.nz). Comments on the report are invited by 26 April 2002.

ends


© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Also, Loan Interest: Productivity Commission On Tertiary Education

Key recommendations include better quality control; making it easier for students to transfer between courses; abolishing University Entrance; enabling tertiary institutions to own and control their assets; making it easier for new providers to enter the system; and facilitating more and faster innovation by tertiary education providers... More>>

ALSO:

Higher Payments: Wellington Regional Council Becomes A Living Wage Employer

Councillor Sue Kedgley said she was delighted that the Wellington Regional Council unanimously adopted her motion to become a Living Wage employer, making it the first regional council in New Zealand to do so. More>>

ALSO:

Scoop Images:
Dame Patsy Reddy Sworn In As Governor-General

This morning Dame Patsy Reddy was sworn in as the New Zealand Realm’s 21st Governor-General. The ceremony began with a pōwhiri to welcome Dame Patsy and her husband Sir David Gascoigne to Parliament. More>>

ALSO:

Ruataniwha: DOC, Hawke's Bay Council Developer Take Supreme Court Appeal

The Department of Conservation and Hawke's Bay Regional Investment Company (HBRIC) are appealing to the Supreme Court over a conservation land swap which the Court of Appeal halted. More>>

ALSO:

With NZ's Marama Davidson: Women’s Flotilla Leaves Sicily – Heading For Gaza

Women representing 13 countries spanning five continents began their journey yesterday on Zaytouna-Oliva to the shores of Gaza, which has been under blockade since 2007. On board are a Nobel Peace Laureate, three parliamentarians, a decorated US diplomat, journalists, an Olympic athlete, and a physician. A list of the women with their background can be found here. More>>

Gordon Campbell: On The Key Style Of Crisis Management

At Monday’s post Cabinet press conference Key was in his finest wide- eyed “Problem? What problem?” mode. No, there wasn’t really a problem that top MPI officials had been at odds with each other over the meaning of the fisheries policy and how that policy should be pursued... More>>

ALSO:

Mt Roskill: Greens Will Not Stand In Likely Post-Goff By-Election

“The Green Party’s priority is changing the Government in 2017, and as part of that we’ve decided that we won’t stand a candidate in the probable Mt Roskill by-election... This decision shows the Memorandum of Understanding between Labour and the Green Party is working." More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news