- Hon Simon Watts
- Hon Shane Jones
The Government has appointed independent experts to review the performance of the electricity markets, Energy Minister Simon Watts and Associate Energy Minister Shane Jones say.
“The power crisis we experienced last winter highlighted how important affordable and secure electricity at internationally competitive prices is to the economic growth and prosperity of Kiwi households and businesses alike,” Mr Watts says.
“Energy security is a top priority for the Coalition Government as the economy electrifies and we work to double New Zealand’s renewable electricity generation. We expect to see market-led approaches to energy security throughout the transition, and we want to make sure the markets are performing effectively.
“This review will help ensure our regulatory settings can deliver on the long-term interests of consumers, keep prices down for Kiwis and keep the lights on.
“From the review’s inception, we were clear that we needed experts capable of bringing a fresh perspective to the complex challenges facing our markets. Those chosen are well-qualified with significant expertise in international electricity market design, risk management, competition policy and financial instruments.”
Mr Jones says New Zealand cannot afford another winter like 2024 in which businesses shut down, manufacturing ground to a halt, and cheap coal was brought in from overseas kept the lights on.
“If we are to grow the economy, we cannot allow a shortage of power to stunt that growth. We are a resourceful nation and our businesses have to be able to continue without worrying whether they can afford the power bill or having to choose between shutting down production or keeping staff.”
Global consultancy Frontier Economics will be the lead reviewer, addressing the seven questions specified in the review’s terms of reference.
The two peer review roles will be taken on by a team of international experts in energy economics with particular expertise in market design. The peer reviewers will provide an added layer of quality assurance and accuracy to ensure the review reports are robust and reliable.
New Zealand-based Concept Consulting will act as New Zealand expert advisor, responsible for ensuring Frontier Economics has solid awareness and understanding of the New Zealand context.
“Collectively, these independent experts bring a wealth of experience, insight, and the fresh perspectives needed for this type of review,” Mr Watts says.
Ministers expect the review’s final reports to be delivered by the end of June, after which Cabinet will make decisions on next steps.
