Assessing the New Zealand wholesale electricity market
We commissioned NZIER to do an economic analysis of the New Zealand wholesale electricity market, to identify potential concerns for small electricity consumers.
Towards the end of 2022, we commissioned NZIER to complete an economic analysis of the New Zealand wholesale electricity market, to help us identify potential concerns in the market for residential and small business customers. We also asked NZIER to recommend areas where further analysis may be required.
The objective of this research was to help us raise evidence-based issues in our submission to the Electricity Authority’s (EA) consultation on the Wholesale Electricity Market Competition Review. The EA released an issues paper for consultation, as part of their work to understand how to promote competition in the electricity market in the transition towards 100% renewable electricity.
NZIER placed the government’s goal of achieving 100% renewable electricity by 2030 at the core of their analysis framework, alongside the current socio-economic state of NZ’s households and small businesses. They then evaluated the performance of the New Zealand wholesale electricity market against 4 criteria:
- equity
- security of electricity supply
- market efficiency
- environmental sustainability.
Their evaluation was based on findings from their quantitative analysis assessing current trends in the New Zealand wholesale electricity market, and desktop research on the literature related to the electricity sector in New Zealand and overseas.
In their report, NZIER discussed potential concerns in the market for residential and small business electricity consumers, and made recommendations for areas in which we could do further work. We used their findings to inform the recommendations we made to the EA in our response to their consultation.
You can read the submission we commissioned this research for on our Submissions page.
Submission: Promoting competition in the wholesale electricity market