Call for experts to develop standardised flexibility contracts for wholesale market

The Electricity Authority invites expressions of interest from flexibility sellers, buyers and financial intermediaries to join a technical group to co-design standardised flexibility contracts for buying and selling wholesale electricity.

This group of representatives will work with the Authority to develop flexibility products from October to December 2024. Trading of the products will commence in early 2025.

Consumers and industry stand to benefit from trade in flexibility products. The market for flexibility products will provide an important price signal for investment in new generation and demand flexibility solutions, ensuring consumers benefit from more reliable and affordable electricity.

As New Zealand develops more intermittent generation - like wind and solar – electricity supply needs to be firmed with generation from hydro or other flexible generation.

Access to flexibility contracts will act as “insurance” for this firming and will give participants another risk management tool to manage financial risk, particularly during periods of volatility.

The Authority will use the revised Hedge Disclosure Obligations to monitor trade in both standardised and non-standardised flexibility products.

When trading begins the Authority will measure and publish information about flexibility contracts trading as part of a broader suite of competition indicators.

This information will inform the decision to implement stronger pro-competition measures if necessary.

This work implements recommendation 8 from the Market Development Advisory Group’s final report on Price Discovery in a Renewable-Based Electricity System.

Nominations for the technical group have been extended until 5pm, Tuesday 3 September. Please complete and return the nomination form to info@ea.govt.nz