An exempt participant under the Electricity Governance Regulations (Regulations) is a participant who is exempt from providing registration information under regulation 7. Exempt participants continue to be subject to all of the provisions of the Regulations and the Rules, but are simply exempt from providing registration information.

Regulation 4 defines an exempt participant as

“a participant that carries out no activities referred to in section 4 or section 5 of the Electricity Industry Reform Act (EIRA) other than activities listed in section 4(2) or 5(2) of that Act”,

which is related to participants who are either “electricity lines businesses” or “electricity supply businesses”.

Electricity lines businesses

Section 4 of EIRA is the definition of an “electricity lines business”, which is a business that conveys electricity by lines in New Zealand and includes the ownership or operation, directly or indirectly, of lines in New Zealand or any other core assets of an electricity lines business.

If you are an electricity lines business you are a participant. You are, however, registration exempt if your activities are limited to:

1. Conveying, together with your associates (if any), less than 2.5 GWh per annum (approximately 285 kW on average):
2. Conveying electricity solely for your own consumption or for the consumption of your associates:
3. Conveying electricity only from a generator to the national grid or from the national grid to a generator:
4. Conveying electricity (other than via the national grid) only from a generator to a local distribution network or from a local distribution network to a generator:
5. Conveying electricity by lines that are owned or operated by a business that also owns or operates a generator which generates electricity solely for the consumption of a local community, where both those lines and that generator are not connected, directly or indirectly, to the national grid:
6. Conveying electricity only by a line or lines that are mostly in competition with a line or lines operated by another electricity lines business that is not an associate of the person, provided that the competition is actual competition and not potential competition:
7. Owning or operating, directly or indirectly, lines referred to in any of paragraphs (a) to (f) or any other core assets of an electricity lines business used in connection with those lines.

Electricity supply businesses

Section 5 of EIRA is the definition of an “electricity supply business”, which is:

1. A business that—
2. Sells electricity in New Zealand; or
   1. Sells financial hedges for risks relating to the price of electricity in New Zealand; or
   2. Generates electricity in New Zealand; or
   3. Trades in rights to sell or generate electricity in New Zealand; and
3. Includes the ownership or operation, directly or indirectly, of a generator in New Zealand or any other core generation assets; and
4. Includes the ownership or operation, directly or indirectly, of any core assets of an electricity retail business, which include—
   1. The customer data base relating to and used for the purposes of an electricity retail or electricity trading business; and
   2. The benefit of a contract to sell electricity; and
   3. The benefit of an undertaking from any other electricity supply business not to compete with the business.

If you are an electricity supply business you are a participant. You are, however, registration exempt if your activities are limited to:

1. Selling or generating less than 2.5 GWh per annum (approximately 285 kW on average):
2. Generating or selling electricity solely for your own consumption or for the consumption of your associates:
3. Generating electricity solely for the consumption of a local community, where—
   1. The generator is owned or operated by a business that also conveys electricity by line; and
   2. Both those lines and that generator are not connected, directly or indirectly, to the national grid:
4. Selling electricity that is generated at a generator referred to in paragraph (c):
5. Generating electricity from distributed generation, and selling the electricity generated, where—
   1. the generating capacity of the distributed generation is no more, at any one time, than the greater of 5 MW (determined according to nameplate or nameplates) and 2% of the maximum demand, in the immediately preceding financial year, of the system to which the distributed generation is connected; and
   2. the distributed generation is owned or operated by a business that also conveys electricity by line and that distributed generation is connected to those lines:
6. Selling financial transmission rights that hedge risks arising from the effects of losses and constraints on the national grid:
7. Owning or operating, directly or indirectly, a generator referred to in any of paragraphs (b) to (f) or subsection (3) or any other core generation assets used in connection with those generators.

An electricity supply business is also registration exempt if the total generating capacity (determined according to nameplate) of the business, together with its associates (if any), is 5MW or less.

For further information please contact the Electricity Commission on 04 460 8860 or at info@electricitycommission.govt.nz.