Efficient procurement of extended reserve Industry briefing 31 October 2016—Wellington 3 November 2016—Auckland Clive Bull—Strata Energy Consulting

welcome housekeeping—exits, bathrooms introductions—Electricity Authority, Transpower (system operator) and NZX (extended reserve manager)

Today’s Briefing currently consulting on draft technical requirements schedule and draft selection methodology— consultation papers published on Transpower and NZX websites written submissions—due by 5 pm on Tuesday 29 November 2016 neither the service providers nor the Authority have fixed or final views on the matters being consulted on today’s purpose— overview the consultation documents and answer questions help you to better understand the proposals and inform submissions implementation focus—we are not in a position to negotiate decisions the Authority Board has already made regarding policy

the process to date 2014 Code amendment for new extended reserve provisions System reliability Selection efficiency System Operator— reviewed AUFLS system performance published a technical requirements report in 2013 concluded improvements could be made, considered options and recommended a 4-block NI AUFLS scheme—10/10/6/6, min. & max. The Authority— reviewed the way that AUFLS load is procured concluded a centralised selection process would deliver additional efficiency benefits amended the Code (c. 2014) appointed ERM

old vs new AUFLS—system security mechanism—quickly sheds blocks of load old AUFLS new AUFLS a minimum aggregate percentage obligation per distributor— 16%+16% distributors self-select the load & self-manage under-frequency relays—usually at distribution feeder level SO sets new technical requirements NI asset owners provide load data ERM centrally selects DUs from aggregated data ER providers— writes implementation plan for SO approval fit, test, commission, arm provide regular data updates ERM PPR & flexible re-solve

Today’s agenda 10:15 am (now)—technical requirements schedule (system operator) 11:30 am—selection methodology (extended reserve manager) 12:45 pm—lunch break 1:15 pm—data provision process (extended reserve manager) 1:45 pm—implementation planning (system operator) aim to wrap up by 2:30 pm Auckland session times