Initial Default Price Quality Path

Under s 55E(2) of the Commerce Act, the Commerce Commission is required to set an initial default price-quality path for gas pipeline businesses as soon as practicable after 1 July 2010.

Deferral of commencement date: initial default price-quality paths for gas pipeline businesses

We have decided to defer the start of the initial default price-quality paths (initial DPP’s) for gas pipeline businesses beyond 1 July 2012. As a result we have not published a determination by 29 February 2012 as we previously indicated. We have taken account of responses from interested persons in making our decision.

What deferral means for suppliers subject to gas authorisations

The gas authorisations for Powerco and Vector are due to expire on 1 July 212.

The initial DPPs for these suppliers will commence as soon as practicable after 1 July 2012. Until the initial DPPs are determined, Section 55F(2) of the Commerce Act applies to all suppliers of gas pipeline services.

Current Document

Project Timeline

Type	Description	Indicative date/s
Draft Determination	Draft Initial Default Price-Quality Paths for Gas Pipelines Businesses Draft Reasons Paper and Draft Determinations	21/11/2011
Draft Determination	Submissions on Draft Initial Default Price-Quality Paths for Gas Pipelines Businesses Draft Reasons Paper and Draft Determinations	19/12/2011
Draft Determination	Cross-submissions on Draft Initial Default Price-Quality Paths for Gas Pipelines Businesses Draft Reasons Paper and Draft Determinations	20/01/2012
Final Determination	Initial Default Price-Quality Paths for Gas Pipelines Businesses Final Reasons Paper and Final Determinations, TBC – no later than 1 October 2013.	01/10/2013

Disclaimer

These dates are not official and may change. Please see the Terms and Conditions for further limitations.

Next Steps

We will consult on a revised process later this year, including a new proposed commencement date. The initial DPPs will start as soon as practicable, taking effect on a relevant quarter but no later than 1 October 2013.We will be consulting on additional input methodologies for gas pipeline services and electricity distribution services, including a stand-alone input methodology for starting price adjustments. The deadline for determining these additional input methodologies is 30 September 2012.

Supporting Documents

Proposed recommendation to the Minister that Tag Oil's sidewinder pipeline be added to schedule 6 for the Commerce Act 1986

03/06/2011 (1 document)

Proposed Recommendation to the Minister that TAG Oils Sidewinder Pipeline be added to Schedule 6 of the Commerce Act 1986 2 June 2011 2 Adobe Acrobat PDF (182 KB) (opens in a new window): This paper proposes that the Sidewinder Pipeline be included in the list of exempt pipelines in Schedule 6 of the Commerce Act 1986. The effect of this inclusion would be to exempt the pipeline from the requirements of information disclosure and price-quality regulation under Part 4 of the Act. The exemption has been sought by the owner of that pipeline, TAG Oil (NZ) Limited.

Proposal to include the Rimu Pipeline in Schedule 6 of the Commerce Act 1986

11/02/2011 (1 document)

Proposed Recommendation to the Minister that the Rimu Pipeline be added to Schedule 6 of the Commerce Act 1986 11 February 2011 Adobe Acrobat PDF (165 KB) (opens in a new window): This paper proposes that the Rimu Pipeline be included in the list of exempt pipelines in Schedule 6 of the Commerce Act 1986. The effect of this inclusion would be to exempt the pipeline from the requirements of information disclosure and price-quality regulation under Part 4 of the Act. The exemption has been sought by the owner of that pipeline, Origin Energy Resources NZ (Rimu) Limited..

Starting Price Adjustments - Discussion Paper

10/11/2010 (2 documents)

Starting Price Adjustments for Default Price Quality Paths Discussion Paper 5 August 2010 Adobe Acrobat PDF (325 KB) (opens in a new window): A fundamental component of a default price-quality path is the starting prices that are specified for each regulated supplier. One option available to the Commission is to adjust starting prices based on the current and projected profitability of each supplier.

This discussion paper sets out the Commission's current views on key aspects of the starting price adjustment process for deault price-quality paths.
Default Price Quality Paths Model for SPA Illustrative Worked Example 5 August 2010 Microsoft Excel Spreadsheet (1.7 MB) (opens in a new window)

Updated Process Paper

15/04/2010 (1 document)

Default/Customised Price-Quality Regulation - Setting of the Default Price-Quality Path fro Suppliers of Gas Pipeline Services - Updated Process Paper - 9 October 2009 Adobe Acrobat PDF (57 KB) (opens in a new window): On 24 July 2009, the Commerce Commission (“Commission”) issued a paper (“Process Paper”) outlining the process it proposed to follow in setting the initial default price-quality path (“DPP”) for suppliers of gas pipeline services (“GPBs”).
The Commission invited submissions on the proposed process and, after consideration of these submissions it has revised its process.

2005/06 Gas Authorisation Process

(8 documents)

Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd - Further Opportunity for Submissions on Asset Valuation and Update on the Authorisation - 10 July 2008 Adobe Acrobat PDF (39 KB) (opens in a new window): The purpose of this memorandum is to:
- notify interested parties of a further opportunity to make submissions to the Commission on matters relating to setting the initial opening regulatory asset base for the Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd (Authorisation); and
- provide an update on other matters relating to the Authorisation.
Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd - Extension to Timeframe for Submissions on Draft Decisions - 30 October 2007 Adobe Acrobat PDF (21 KB) (opens in a new window): On 4 October 2007 the Commission issued its Draft Decisions Paper1 and indicated that written submissions on the Draft Decisions Paper should be received by the Commission no later than 12 pm on 12 November 2007.
Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd - Release Date for Draft Decisions Paper - 20 September 2007 Adobe Acrobat PDF (23 KB) (opens in a new window): On 27 August 2007 the Commission indicated that the Commission’s Draft Decisions Paper for the Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd (Authorisation) would be released on 24 September 2007.
Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd - Update to Timetable - 27 August 2007 Adobe Acrobat PDF (24 KB) (opens in a new window): This memorandum sets out the Commission’s updated timetable for the completion of the Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd (Authorisation).
Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd Process Paper (Amended) & Consultation on Consideration of Amending Provisional Authorisation - 2 June 2006 Adobe Acrobat PDF (88 KB) (opens in a new window): This Paper has two sections. Section One describes the Commerce Commission’s (Commission) proposed approach for issuing the final determination for the authorisation (Final Authorisation) of the supply of gas distribution services by Vector Ltd (Vector) and Powerco Ltd (Powerco). The approach has been revised following a review of the process and work streams to date. Please note that this amended process replaces the process previously described in the Process Paper dated 24 January 20061
Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd Process Paper - 24 January 2006 Adobe Acrobat PDF (46 KB) (opens in a new window): This Paper describes the Commerce Commission’s (the Commission) proposed
approach for issuing the final determination for the authorisation of the supply of gas distribution services by Vector Ltd (Vector) and Powerco Ltd (Powerco).
Authorisation for the Control of Supply of Natural Gas Distribution Services by Vector Ltd and Powerco Ltd Proposed Process Paper - 17 November 2005 Adobe Acrobat PDF (50 KB) (opens in a new window): This Paper describes the Commerce Commission’s (the Commission) proposed approach for issuing the final determination for the authorisation of the supply of gas distribution services by Vector Ltd (Vector) and Powerco Ltd (Powerco). Interested Parties are invited to submit comments on the proposed approach by 8 December 2005.
Gas Control - Invitation for Expressions of Interest - Expert Advice - October 2005 Adobe Acrobat PDF (49 KB) (opens in a new window): This invitation for expressions of interest is issued by the New Zealand Commerce Commission (the Commission).
The Commission anticipates engaging consultants to assist it in a range of areas relevant to the implementation of control over controlled services, identified in the Commerce (Control of Natural Gas Services) Order 2005. These are essentially the gas distribution services of Vector and Powerco as well as metering services owned by Powerco. In order to streamline the process of selecting consultants, the Commission is now seeking expressions of interest from suitably qualified persons.

Initial Default Price Quality Path

Deferral of commencement date: initial default price-quality paths for gas pipeline businesses

What deferral means for suppliers subject to gas authorisations

Current Document

Deferral of initial DPPs for GPBs 29 February 2012 Adobe Acrobat PDF (370 KB)

Project Timeline

Disclaimer

Next Steps

Supporting Documents

Initial DPP - Commencement date deferral 29 February 2012

Submissions on Initial DPP - Commencement date deferral - 13 February 2012

Initial DPP - Commencement date deferral - Draft Decision 3 February 2012

Cross Submissions Initial Draft Price-Quality-Path GPBs - Draft Reasons

Submissions Initial Draft Price-Quality Path GPBs - Draft Reasons Paper

Correspondence on Draft Determinations for GPBs