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North Auckland and Northland proposal


Transpower’s application (September 2007)

On 21 September 2007, Transpower New Zealand Limited submitted to the Electricity Commission a new grid upgrade plan (2007 GUP) under clause 12 of section III of part F of the Electricity Governance Rules 2003.

The 2007 GUP includes two proposals relating to investments in North Auckland and Northland. 

The first proposal (NAaN proposal 1) has been submitted as a reliability investment and includes the installation of a 220kV cross harbour cable connection between Penrose and Albany substations, and the reinforcement of Penrose substation from Pakuranga substation.

 The second proposal (NAaN proposal 2) has also been submitted as a reliability investment, and involves Transpower securing rights to preserve the option to install a second cable.

Modelling material provided by Transpower in support of its proposal

Opportunity for comment (27 September 2007)

Under rule 13.3.2 and rule 13.3.5 of section III of part F of the Electricity Governance Rules 2003, the Commission gave notice that it was providing designated transmission customers and parties affected by the proposals with an opportunity to: 
  • provide written comments on NAaN proposal 1 and NAaN proposal 2; and
  • request that the Commission consider alternatives to NAan proposal 1, and alternatives to NAaN proposal 2. 
Comments and/or requests were sought by the Commission by midday on Friday 9 November 2007.  The Commission received 10 submissions.

Commission's comments on draft proposal

Outstanding issues (September 2007)

 In preparing submissions, designated transmission customers and affected parties should note that the Commission raised with Transpower a number of issues relating to NAaN proposal 1 prior to receiving the 2007 GUP.  These are summarised below and further details are provided in the Commission’s letter of 31 August 2007.

 1 - Northern Generation Option - the Commission has asked Transpower to further explain its indicative GIT analysis of the Northern generation option (which has not been included as an alternative project);

2 – Capital Costs- Transpower has indicated that it will provide additional detail regarding capital costs shortly in a format previously agreed with the Commission;

3 – The Commission has asked Transpower to explain the economic basis for its load shifting assumptions between Penrose and Mt Roskill grid exit points;

4 –The GIT application relies on significant avoided investment costs in Vector’s network.  The Commission is seeking further information regarding the costs that will be avoided by Vector if NAaN proposal 1 is implemented;

5 – Transpower has agreed to provide a revised reliability benefit analysis;

6 – The Commission has asked for further information regarding the property costs relating to the HTC alternative.

On 2 October 2007, the Commission wrote to Transpower seeking additional information on the issues listed above. On 15 October 2007, Transpower wrote to the Commission providing further information.

Additional scenario (October 2007)

In light of the recently finalised NZES and other developments in the Government's climate change policies, the Commission wrote to Transpower on 12 October 2007 pdf [244 KB]

to ask Transpower to provide revised NPV results for the NAaN proposals based on the addition of a “90% renewables by 2025” scenario.  The Commission will consider this new scenario as well as the 4 other scenarios.

On 26 October 2007, Transpower provided the results of the analysis.

Timetable (updated May 2008)

On 20 December 2007 the Commission wrote to Transpower proposing a revised timetable for NAaN Proposals 1 and 2.

On 13 February 2007, Transpower wrote to the Commission advising that it was unable to agree a timetable as it was still discussing the timing of grid reinforcements into Penrose and through to Albany with Vector.

Transpower suggested that the agreement on the timetable be deferred until Transpower had completed the work.

On 9 May 2008, Transpower submitted revised versions of the NAaN proposals to the Commission. On 14 May 2008, the Commission and Transpower agreed a timetable for consideration and approval of the proposals (“the May 2008 timetable”)

Revised proposals submitted (May 2008)

On 9 May 2008, Transpower submitted revised versions of the NAaN proposals (revised Proposals) to the Commission. Transpower is now seeking approval for $577 million for proposal 1 and $12.9 million for  proposal 2.

The main changes to the original proposals are:

  • the amount for which approval is sought has increased from $515 million to $577 million (in $2013) for proposal 1;
  • the amount for which approval is sought for proposal 2 has increased from $6.2 million to $12.9 million (in $2009);
  • Transpower advises that the technical need date for proposal 1 is 2016 but is seeking approval for a 2013 commissioning date;
  • Transpower’s proposal 1 anticipates using the Vector tunnel between Penrose and Hobson substations as opposed to the road route option even though the costs are greater;
  • additional works have also been included, notably a new 220/110kV transformer at Penrose which will resolve an issue created by the North Island Grid Upgrade project; and
  • Transpower provided further analysis of the non-transmission option (generation at Rodney).

 

Opportunity for comment (May 2008)

Under rule 13.3.2 and rule 13.3.5 of section III of part F of the Electricity Governance Rules 2003, the Commission gaves notice  to provide designated transmission customers and parties affected by the revised proposals with an opportunity to:

  • provide written comments on Transpower’s revised proposals; and
  • request that the Commission consider alternatives to Transpower’s revised proposals. 

Comments and/or requests were sought by the Commission by 5.00 pm on Thursday 5 June 2008.  The Commission received 8 submissions.

Correspondence

 

Last update on 25 June 2008 10:31 AM