Electricity industry works together to prepare for winter

The electricity industry is better prepared to meet the challenges of managing potential supply issues during winter peaks after the implementation of initiatives and exercises to test processes, says Electricity Authority chair Nicki Crauford.

"The Authority responded quickly to warnings late last year that tight supply situations could be prevalent this winter and has, with the cooperation of the system operator and the support of the industry, put in place four initiatives to assist the management of such situations,” says Dr Crauford.

"It is heartening to see those in the industry – the system operator, retailers, generators and lines companies – pull together in a collaborative way to respond to the evolving nature of the electricity system.

"We are in the midst of a transition to an electricity system which is becoming more reliant on intermittent, renewable sources of electricity such as wind and solar while demand is increasing and a coordinated approach is necessary to help navigate the challenges and opportunities that this presents.

"To be clear, we have enough generation capacity to meet peak demand, but for short durations, such as morning or evening peaks, there may not be enough supply offered to meet forecast demand because of unexpected circumstances such as equipment failure or wind dropping away.

"We believe the steps we have taken will reduce uncertainty and improve decision-making to efficiently manage situations this winter. We have also identified other longer-term initiatives that we will develop to give us more levers to pull in coming years,” says Dr Crauford.

To also help prepare for this winter two industry contingency exercises have been held in recent weeks pulling together expertise from the system operator, lines companies and retailers.

"The Authority identified the need for such an exercise in its review into the 9 August 2021 power disruptions, and the MBIE investigation also recommended the same.

"Both exercises were well supported by the industry and it is encouraging that everyone is taking responsibility to manage their roles in the electricity system in the event it comes under pressure.

"No one expects to be without power when they flick on a switch during a winter’s evening and while we cannot guarantee there won’t be any disruptions, consumers can be assured that everyone is working together to best manage situations if they arise and will have more tools in the toolbox than ever before.

"As the regulator of the electricity market our job is to provide the appropriate incentives for participants, but any incentive must be in the long-term benefit of consumers,” says Dr Crauford.