UTS 16 February 2024

Overview

The Electricity Authority carried out an investigation into a possible undesirable trading situation (UTS) that arose following a High Court decision released on 16 February 2024.

The High Court decided scarcity prices were incorrectly applied to four trading periods on 9 August 2021. As a result of the High Court decision, prices on 9 August 2021 have been determined by offers and demand management by the system operator.

The Authority carried out an investigation into a possible UTS as a result.

Following the investigation, we have reached a preliminary decision that a UTS has developed and are now seeking feedback on this decision.

Our preliminary decision

Following an investigation into the possible UTS, our preliminary decision is that prices for trading periods 38 and 39 were artificially depressed by demand management, in circumstances where participants would expect higher prices to apply, and this threatens, or may threaten, confidence in the wholesale market.

We invited feedback on our preliminary decision paper, which sets out our investigation and findings.

Submissions on our preliminary decision

We would like to thank all submitters who provided input on our preliminary decision. Here are the six submissions received:

Cross-submissions invited

Cross-submissions on the submissions provided are welcomed and can be sent to uts.2024@ea.govt.nz by 5pm on Wednesday 3 July 2024.