Shaping New Zealand’s energy transition conversation for Electricity Networks Aotearoa

How do you create a distributed energy model that draws on best practice from around the world but is also fit-for-purpose for New Zealand?

Electricity Networks Aotearoa (ENA) is the industry association representing the 29 lines companies who make sure New Zealanders have reliable, sustainable and affordable electricity networks. A key player in the nation’s energy transition, one of ENA’s key areas of focus is the evolution of New Zealand’s Distribution System Operation (DSO) model to take into account two-way loads as electric vehicles, batteries and rooftop solar join the grid. 

ENA knew that Baringa understands the New Zealand market, does energy system modelling in 60 countries and is at the heart of DSO reforms in the UK, US and Australia. With New Zealand’s Electricity Authority, Te Mana Hiko, planning a major consultation on Future System Operation later in the year, ENA asked Baringa to work with its members to set out possible DSO models appropriate for New Zealand and craft an expert report as a discussion starter for the upcoming national conversation.

Consulting with multiple lines companies

A well-designed DSO model ensures the grid can accommodate two-way electricity flows, support decentralised generation and maintain system stability, all while enabling innovation and competition. But one size does not fit all. Grid architecture, geography, market structure and ownership models, renewable integration needs and regulatory settings all influence model design. 

We formed an on-the-ground team of energy policy and regulatory experts who met frequently with New Zealand members to discuss what international learnings could be applied in New Zealand and where bespoke solutions needed to be developed. With input from our UK colleagues, we developed three potential DSO models for Aotearoa. The report, which was presented to ENA within two months, also outlines a shortlist of least-regrets actions that could move New Zealand closer to a preferred model and recommendations to unlock whole-of-system value for consumers.   

Setting the direction for reform

By defining possible DSO models in the New Zealand context for the first time, and including international case studies, the report has become a useful resource for those preparing submissions for the Future System Operation discussion. It does not impose answers, but instead provides feasible options for New Zealand, incorporating relevant ‘what works’ lessons from other jurisdictions. 

Find out how we help our clients in Energy Networks