Pricing in a renewables-based electricity system

Update to scarcity pricing settings

Upcoming Open Closed Decision

View submissions Submissions closed 29 November 2024

Decision

We have decided to amend the Electricity Industry Participation Code 2010 to:

raise energy scarcity prices
reduce the number of reserve scarcity blocks
raise reserve scarcity prices
raise the default value for controllable load.

The new settings, effective from 17 April 2025, support security of supply in the shoulder season leading up to winter.

We would like to thank everyone who engaged with this consultation. Feedback from submitters has been incorporated into the final decision.

Read the decision paper

Read the scarcity pricing fact sheet

Consultation

This consultation sought feedback on proposed amendments to the Electricity Industry Participation Code to update the scarcity pricing settings.

Our proposed Code amendment aims to:

better reflect consumer expectations that power cuts should not occur while there is generation capacity available for dispatch
better reflect the high cost of involuntary demand reduction on consumers and businesses
improve price signals during periods of potential scarcity to assist with resource coordination and to continue to provide robust signals for investment in flexible capacity.

This update to the scarcity pricing settings is part of our ongoing approach to improve and refine the market settings for security of supply to ensure they are fit-for-purpose, reflect consumer expectations and improve long-term outcomes for consumers.