Thursday, April 25, 2024

Commerce Commission publishes draft airport, energy sector rules

The Commerce Commission is seeking feedback on a draft of its regulatory rules governing energy networks and major international airports.

The rules, known as input methodologies (IMs), provide certainty about how the Commission will approach the regulation of these entities, which are not subject to competition from rival participants. The rules are reviewed every seven years and play a crucial role in ensuring consumers get value for money from essential infrastructure. 

Commissioner Vhari McWha says the review is a significant piece of work given the importance of these sectors in the economy and everyday lives of New Zealanders, and welcomes all feedback and views on the draft decisions.

“We rely on energy and airport infrastructure when we turn on the lights, heat our homes, and travel from place to place. This is why it’s so important that we hear the views of all stakeholders to make the best decisions on the rules that will govern the regulation of this critical infrastructure,” the Commissioner said.

“A key focus has been to consider how our rules can help support consumers in the transition to a low carbon economy, while encouraging innovation and the delivery of resilient energy network and airport services at the right cost.”

“We want to ensure that the regulations provide suppliers with incentives to invest, innovate and achieve efficiencies that they can share with consumers.

“Overall, the IM regime currently does this well but we have identified some areas where the rules can be refined to deliver better outcomes, increase certainty and reduce costs —particularly to ensure we are able to respond in an appropriate and timely way to changes in the national and global environment,” she said.

There will be further opportunities to consider the needs of consumers and suppliers in these sectors when the Commission resets revenue and quality controls, and reviews requirements for the public disclosure of information relating to the performance of these sectors. 

The Commission welcomes feedback on its draft decisions by 5pm on 19 July 2023, followed by two weeks for cross submissions. Submissions specific to Transpower’s draft input methodology determinations are due slightly later, by 5pm 26 July 2023, followed by two weeks for cross submissions. 

Submissions can be sent to IM.Review@comcom.govt.nz. The Commission will consider feedback and make its final decision later this year. 

The Commission will publish its final decisions in December 2023 and the amended rules will be applied from 2024.  

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