The 'Electric Election': energy policies, side by side
Warren G and Nate Dogg said it best when they said: 'Regulators, mount up!' - and this week, they have.In a rare joint open letter, three different regulators - EECA (Energy Efficiency and Conservation Authority), the Commerce Commission and the Electricity Authority - have basically told the lines companies to pull their socks up and make the most of ‘non-network solutions’ (AKA stop building more expensive poles and wires and start looking at customers and new technology as part of the solution!).
As the letter says: “By shifting electricity use away from peak periods and better aligning demand with available network capacity, flexibility can reduce pressure on upstream networks, lower the need for high-cost generation and defer or avoid expensive network upgrades. Non-network solutions can also buy time before committing to major upgrades and allow network owners to refine their forecasting and demand assumptions. This means when (or if) reinforcement is needed, it is based on better information and more accurate cost-benefit analysis.”
Lines companies are incentivised to build assets that they control. These investments are approved by the regulators and paid for by customers. But one of our primary arguments is that if modern technology like solar, batteries and smart devices to shift demand can do the same job for less, that should be the path that is chosen.
It’s good to see the regulators pushing in this direction with their letter, and it was good to see EECA’s report showing there’s a $3 billion opportunity on the table, just from moving away from peak electricity usage.
Incentives matter - for customers and the big players. Carrots help spark innovation, but sometimes you also need a few well-placed sticks to keep the system honest, something the EA has been given recently to deal with bad behaviour.
With lines charges projected to rise, this is a chance to fine-tune the regulatory toolkit, strengthen the Commerce Commission’s powers where needed, and back ideas like network utilisation targets before major new investments get the go ahead.
Lines companies could (and should) massively improve their pricing signals so there are better incentives for customers to contribute to the energy system or shift demand at certain times. But we have seen some examples of retailers not passing those benefits on or not reflecting them in their consumer offerings. That is a broken link and also needs to be addressed.
We've seen a great response from MOST lines companies to Energy Minister Simon Watts' letter late last year and some of them are embracing this future. Hopefully ALL of them will take notice of this united front from the regulators and start to think a bit differently.
We applaud all three for writing this letter - and for taking on board some of our arguments. Our door is always open if any of the lines companies want some help to deliver better outcomes for customers and speed up the adoption of these helpful technologies.
'Twas the night before Chris-mas, and all through the house, all the voters were stirring, the pundits showing their nous … the election will soon be over, but the energy crisis won't, so we'll be there to pester whoever is in power about the need to run more of the economy on New Zealand-made energy; can Ethiopia's aggressive push for EVs work and how does New Zealand compare in terms of adoption rates?; a two-way charging trial from Genesis shows promise in Auckland, but there's still a way to go before it's mainstream; small electric vehicles are often overlooked when it comes to electrifying transport, but it's hard to miss this weird French one; a solar-powered cafe (and some electric coffee); and we endorse the political vandalism of Keith of All Trades.
Read moreDownloadPoliticians are being urged to adopt stronger electric vehicle incentives ahead of the election. Climate and energy advocacy group Rewiring Aotearoa is arguing that EVs are one of the most effective long-term solutions for rising transport and energy costs. They're promoting an EV Salary Boost proposal, which would allow workers to access EVs through pre-tax salary arrangements – similarly to already existing schemes in the UK and Australia. Policy and Government Relations Spokesperson Ngaio Neumegen told Kerre Woodham that even with the rising cost of power, it's still cheaper to run an EV than a car running on imported fuel.
A proposal that would let New Zealanders lease an electric car using their before-tax pay has not won a commitment from either National or Labour, with the 7 November election days away. Under the EV Salary Boost, put forward by Rewiring Aotearoa and Drive Electric, an employee would lease a new or used EV for three to five years. The payments would come out of their pay before tax, lowering the cost of running the car. The idea is based on Australia’s novated leasing system, though the groups say they are not proposing a direct copy.
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