How do businesses apply for a CPP?

The rules and processes for a CPP proposal, including the requirements for a proposal and the criteria we must consider when evaluating a proposal, are set out in input methodologies that we have developed. Input methodologies are rules, processes, requirements and evaluation criteria for services that are regulated under Part 4 of the Commerce Act.

When can a proposal be submitted?

Electricity distribution businesses have specified timeframes in which they can submit a customised price-quality proposal to us – potential applicants should contact us.

However, in the case of a ‘catastrophic event’, a business can submit a proposal at any time in the 24 months following the event, except in the 12 months before the default price-quality path is due to be reset.

What does an application need to include?

The information an applicant must provide when proposing a CPP is set out in the input methodologies. This includes:

• the reasons for the proposal
• the duration of the CPP the applicant is seeking (if less than 5 years)
• financial and other relevant information (such as forecast capital and operating expenditure) to allow us to assess an appropriate price path
• an audit report and certification from the directors confirming the information provided within a proposal is accurate
• an independent expert’s opinion verifying the contents of the proposal and the reasonableness of the assumptions and methodologies used.

Before formally submitting a proposal, a business will provide a summary of the expected proposal, and consult with consumers about the changes it is proposing. In its application it must provide evidence of consultation with consumers, a description of all issues raised and an explanation of whether its proposal accommodates these issues and if not, why not.

There is a standard application fee of $20,000 that must be paid by all applicants at the time they submit their proposals to us. The fee is intended to be a part payment for costs that we will incur for assessing the application and setting a CPP.

For more information, and questions and answers about CPPs, read our CPP fact sheet. ( 444 KB, PDF )