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INFORMATION DISCLOSURE REQUIREMENTS FOR ENERGY: SECTOR BRIEFING ON EMERGING VIEWS 7 October 2011 SESSION 1: INTRODUCTION This session will cover: → Purpose of this briefing → Revised timeline for ID requirements → Agenda 2 PURPOSE OF THIS BRIEFING → Update on our emerging views on ID requirements → Identify areas where more work is needed to ensure sufficient information is disclosed, and in an appropriate format to assist interested persons: • • To assess whether the purpose of Part 4 is being met; and To understand the performance of regulated suppliers, their relative performance, and changes in performance over time → Provide an overview of our thinking on assessing cost efficiency → Set out the next steps in developing draft information disclosure requirements 3 REVISED TIMELINE FOR INFORMATION DISCLOSURE Step Indicative Timing Emerging views briefing 7 October Technical reference groups on draft EDB/GPB ID requirements October – November Transpower ID workshop (after revised capex IM released) November Draft determinations released (EDBs and GPBs) Late December Submissions / cross-submissions February 2012 ID determinations finalised (EDBs and GPBS) April 2012 Draft determination released (Transpower) Qtr 2 2012 ID determination finalised (Transpower) Qtr 3 2012 4 AGENDA 5 Session Time Presenter Session 2: Emerging views on ID 9:45am–10:30am John Groot Session 3: Asset related information 10:45am–11:45am Nick Russ / Clive Bull Session 4: Approaches to understanding cost efficiency 12:30pm–1:30pm Isobel Oxley Session 5: Next steps 1:30pm–2:00pm Anna McKinlay SESSION 2: EMERGING VIEWS ON ID This session will cover: → The role of the Commission → Overview of feedback received from stakeholders → Our views on: • • The role and purpose of ID Our role in delivering on the purpose of ID, in particular through reporting on supplier performance → Our emerging views on information disclosure requirements → 2011 Asset Management Plan Review 6 THE ROLE OF THE COMMISSION 7 As we outlined in our Statement of Intent, the Commission’s role is to promote the long-term benefit of consumers in regulated markets → What tools do we have to deliver the outcomes we are seeking? • • • • • • Develop and amend regulatory rules (e.g. IMs, regulatory instruments) to improve markets Advise on and/or put in place the best form of regulation Monitor how well markets are working Publicise information about sector performance Take enforcement action where businesses do not comply; tailoring our approach to each issue Engage with relevant regulated businesses and help them understand regulatory rules Information Disclosure (and Summary & Analysis) STAKEHOLDER FEEDBACK (1) We have met with a range of stakeholders to understand whether and how they use ID, seek their views on key proposals (as discussed in workshops) and their thoughts on usefulness of ID generally → Discussions with a wide range of parties: • • • Gen-tailers (e.g. Genesis, Contact, Meridian) Consumers and their representatives (e.g. Federated Farmers, Domestic Energy Users Network, NZ Defence Force, Fonterra) Consultancies (e.g. Smartpower, Group Energy Purchase) → Generally, stakeholders welcomed these opportunities as many consider it difficult to engage in our formal consultation processes due to time and resource constraints → We intend to continue talking to a range of stakeholders • Not just limited to consumers and suppliers but also other potential users of ID, e.g. equity analysts, policy makers, investors 8 STAKEHOLDER FEEDBACK (2) Key message from stakeholders: → Many stakeholders (even large ones) consider it is not their role to analyse all the information disclosed for all regulated suppliers • Stakeholders do not currently do so, and do not have the resources for this type of analysis → Instead, they look to the Commission to analyse the information, and to comment on outcomes, issues and/or performance Implication: → We need to consider what information we need to do undertake informative analysis, and tailor the ID requirements accordingly 9 STAKEHOLDER FEEDBACK (3) Other feedback from stakeholders: → Significant use of pricing information. Therefore strong support for proposals to: • • • Require disclosure of capital contributions (as per workshop) Require explanations of changes in prices and revenue requirements over time Require an indication of medium term pricing strategy (if any) → Urgent need for transparency on gas pipeline capacity → Some support for more disaggregated reliability statistics – not just network averages → Support proposal to require AMPs every two years, subject to an update report in the intervening year → In general, little support for requiring disclosure of non-standard contracts (a current requirement) 10 ROLE OF INFORMATION DISCLOSURE (1) 11 s 53A — The purpose of information disclosure regulation is to ensure that sufficient information is readily available to interested persons to assess whether the purpose of Part 4 is being met → Among other things, interested persons need information to assess whether an EDB or GPB is: • • • Managing the assets for the long term Making cost/quality trade offs consistent with present and future customer requirements Striving to achieve efficiencies in all aspects of their business, and sharing these with consumers ROLE OF INFORMATION DISCLOSURE (2) 12 → In practice ID will: • • • Disclose information to inform an assessment of the relative performance of companies Thus, incentivise suppliers to perform better by highlighting how well their peers are performing Potentially increase the total information available to suppliers about their own businesses → ID will help enable: • • • • • Suppliers to identify better ways of running their businesses from their peers Consumers to be better informed about the price and quality they are receiving from their supplier Shareholders or consumer owners to be better informed about how well their business is being managed and thereby improve their ability to govern the business effectively The Commission to more effectively regulate price and quality Current and potential investors better understand the businesses APPROACH TO DETERMINING ID REQUIREMENTS 13 → Our objective is that the ID requirements in the draft determination should be: • • Sufficient to meet the purpose of ID, i.e. to assess whether the Part 4 purpose is being met, While being cost-effective for suppliers to produce → In relation to the sufficiency of information, the requirements should ensure there is sufficient information for us to assess the performance of suppliers over time, and performance between suppliers • This will help us to promote greater understanding of the performance of suppliers • To be cost-effective, where possible, information requirements should align with the type of information that suppliers need to run their business INFORMATION REQUIRED UNDER ID 14 Financial Information ID Pricing Information Asset Management Information EMERGING VIEWS: INFORMATION DISCLOSURE 15 → The next three slides summarise our thinking on the main topics discussed at the Information Disclosure workshops held in May and June 2011 → As we will set out the detailed draft requirements with comprehensive reasons in December 2011, we are not seeking submissions on these emerging views EMERGING VIEWS: FINANCIAL INFORMATION 16 • A range of financial issues were discussed at the Financial Workshop (10 June 2011). • As a result of feedback from suppliers, we are developing a less onerous draft requirement for consolidated financial information, e.g. it is proposed that the requirements would not require the reconciliation of asset registers. This draft requirement will be released for consultation in the draft ID determinations. Financial Information ID Pricing Information Asset Management Information • The treatment of related parties is still a concern. The draft requirement are likely to provide for disclosure on an arms-length basis, supported by information as to why the related party values are on an arms-length basis. EMERGING VIEWS: PRICING INFORMATION 17 • Discussed at the pricing-related disclosures workshop (31 May 2011). • Gas and electricity distribution sectors are to be treated consistently where possible and appropriate. • Support from stakeholders for the changes to pricing methodology requirements as discussed at the workshop, including a view that more explanations are required for changes in prices. Financial Information • We are not proposing to continue the requirement to disclose terms and conditions of non-standard contracts. • We propose that EDB and GPB pricing statistics align with each supplier’s defined customer groups, not the “connection point classes” specified in Schedule 11 of the 2008 EDB ID requirements. • The Electricity Authority is seeking submissions on criteria for assessing alignment with its Information Disclosure Guidelines and Pricing Principles (due 17 October). We will factor this into our process, seeking alignment where possible. ID Pricing Information Asset Management Information EMERGING VIEWS: ASSET MANAGEMENT INFORMATION 18 • We held a workshop on GPB AMP requirements (20 May 2011) and a workshop on proposed Asset Maturity Assessment Tool (AMMAT, 10 June 2011). • Stakeholders support biennial AMPs and AMMAT disclosure. Financial Information • We are likely to include a new requirement to disclose AMMAT self-assessments. • Review of 2011 EDB AMPs to be released shortly (next slides). • We will outline further thinking on asset related information, and the format in which this information is required, in Session 3 of this briefing. We will also discuss this topic with technical reference groups. ID Pricing Information Asset Management Information • Our proposals for changes to ID requirements relating to asset information will be incorporated into the draft ID requirements. 2011 ASSET MANAGEMENT PLAN REVIEW (1) → Parsons Brinkerhoff (PB) report to be released next week → Review included a site visit to two EDBs → Review was targeted. Assessed the three disclosure areas identified in 2009 with relatively weak compliance: • • • Service levels Network development planning Expenditure forecasts, reconciliations and assumptions → Results were very positive. Of 28 EDBs reviewed, 21 EDBs achieved a higher average rating (across the three assessment areas) than they did in 2009 → The highest average rating (across the three assessment areas) achieved by an EDB in 2009 was exceeded by 10 EDBs in 2011 → Concludes that in regard to compliance with the current requirements, no major changes to the requirements are required 19 2011 ASSET MANAGEMENT PLAN REVIEW (2) 2009 Service levels 2011 2009 Network development planning 2011 Expenditure forecasts, reconciliations & assumptions 2009 20 → Service levels: No EDB received a ‘noncompliant’ rating. 52% of ratings were assessed as ‘compliant’. → Network development planning: <2% assessed as ‘non-compliant’. 63% of ratings assessed as ‘compliant’. → Expenditure forecasts, reconciliations and assumptions: 12% assessed as ‘noncompliant’. 61% of ratings assessed as ‘compliant’. Non - Compliant 2011 Partially Compliant Compliant 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% SESSION 3: ASSET MANAGEMENT INFORMATION This session will cover: → → → → → → What we mean by asset management information Overview of proposed approach to asset management information Interaction with the CPP requirements History and evolution of information requirements Discussion of specific asset management information requirements Way forward for AMP requirements 21 WHAT WE MEAN BY ASSET MANAGEMENT INFORMATION (1) Consumers Service requirements 22 Network → Asset management information covers information on: • • • • The physical network (Network) Expenditure on the network (Expenditure) Drivers of expenditure (Drivers) Performance of the network (Performance) → Asset management information is needed for interested parties to assess whether: • • • Assets are being managed for the long term The required level of performance is being delivered Costs are efficient and efficiencies are being achieved Expenditure Drivers Performance WHAT WE MEAN BY ASSET MANAGEMENT INFORMATION (2) 23 → Network data: • • • Data on the physical network Quantity of assets that make a up the network e.g. topology, age, redundancy Consumer Requirements → Expenditure: • • • Reason why a company spends money Gap between consumer requirements and actual performance of the network → Performance: • • Asset Management Plan Expenditure on the network (actuals and forecasts) Both opex and capex → Drivers: • Asset management tools and processes How the network performs Measures of service delivered to consumers Network Data Expenditure Drivers Performance Asset Management information • Required by the companies internally to produce asset manage plans and run the business OVERVIEW OF PROPOSED APPROACH TO ASSET MANAGEMENT INFORMATION (1) 24 → Suppliers already provide much of this type of information through ID and in existing AMPs • Proposed approach is not a fundamental change from what is required to produce the AMP → However, the format of existing disclosures makes it difficult for interested persons to assess whether the Part 4 purpose is being met, or for us to undertake summary and analysis → More standardisation and a consistent format will make the information more useable — in particular in understanding the link between the network, expenditure, drivers and performance (taking account of customer service requirements) • This will also benefit companies as it will allow companies to make better comparisons of relative performance → Proposed approach is to require disclosure of: • • • An AMP (based on a refinement to the current requirements) A set of standardised data templates covering network data, expenditure, drivers and performance A narrative setting out the assumptions used in populating the data templates → Technical reference groups to resolve practical issues, e.g.: • Should the templates be included in the AMP or as an appendix OVERVIEW OF PROPOSED APPROACH TO ASSET MANAGEMENT INFORMATION (2) → To be cost-effective, where practical, information disclosure requirements should be consistent with the type of information that suppliers need to run their business: • Where possible we would like to align the information requirements with existing data, and readily available data formats, if this can provide information sufficient to meet the purpose of ID • In specific areas, where businesses do not already hold the information, we propose including a ‘unknown’ category—so that businesses are not required to provide information they do not currently collect , e.g. detailed asset condition information for high volume low value asset • We recognise that for some areas there will be a transition period while the quality and completeness of the information provided will be improved → We will work with the technical reference groups to help ensure the ID requirements meet the needs of the Commission, regulated businesses and other interested parties 25 INTERACTION WITH CPP REQUIREMENTS It is important that the ID requirements are consistent where possible with the existing CPP requirements (i.e. Schedule D and E of the IM) → While aspects of the proposed ID requirements will differ from to the current CPP information requirements: • • ID development will build on CPP information requirements Different objectives: • ID focus is on actuals with higher level forecasts • CPP focus is on history & forecasts by project/programme • External verifier is not required (IM 5.5.2 Verification) → We propose to develop consistent definitions and assumptions for ID and CPP requirements: • • Avoid creating inconsistent new sets of data mappings by businesses Where possible, ID requirements would simplify preparation of a CPP application to a greater degree than is currently possible 26 EVOLUTION OF ID REQUIREMENTS Gas Gas (Information Disclosure) Regulations 1997 27 The current electricity & gas IDRs have informed the CPP IM. This, in turn, will inform the IDRs under Part 4 Plus input from: Requirements for summary and analysis Inform Electricity Inform Electricity Distribution (Information Disclosure) Requirements 2008 Input Methodology for Customised Price Paths (2010) Inform Development of Information Disclosure Requirements (2011 – 12) Non-exempt EDBs only ‘Inform’ used here means that earlier information requirements provide a starting reference point for later developments Briefing and technical reference groups Views of interested parties EXPENDITURE (1) 28 → Current ID requirements disaggregate expenditure into the following categories → → → → Capex categories Opex Categories Customer Connection General Management, Administration and Overheads System Growth System Management and Operations Asset Replacement and Renewal Routine and Preventative Maintenance Reliability, Safety and Environment Refurbishment and Renewal Maintenance Asset Relocations Fault and Emergency Maintenance Non-System Fixed Assets Other Are the definitions clear and being applied consistently? Can all categories be forecast and over what time horizon? How are categories with multiple drivers allocated (apportioned or by primary driver)? Is further disaggregation required and cost effective? (see next slide) EXPENDITURE (2) 29 → Are the current categories consistent and detailed enough to make the link between drivers, expenditure and performance? → What are the options for capex? • • • • • Currently focus on why money is spent, i.e. the activity or driver (connections, system growth, asset replacement, etc.) Expenditure could be further disaggregated based on what the expenditure is spent on (i.e. type of asset) Type of asset could simply be line/pipe or substation/pressure reducing stations or more detailed, for example overhead line, underground cable, transformer, switchgear, regulators, values , SCADA and other secondary equipment Types of asset could be split by voltage/pressure or voltage/pressure range e.g. LV, HV, LP, MP, etc. Or any combination of the above → What are the options for opex? • • • Further split into sub drivers or activities, for example routine and preventative maintenance includes fault rectification, routine inspection, testing, vegetation management activities Cost could be further disaggregated into these areas Similar to capex, some areas (for example routine and preventative maintenance) could be split by asset type and/or voltage/pressure → Options to be discussed and developed with the technical reference groups before releasing draft ID requirements - important to ensure IDR meet the needs and are cost effective DRIVERS OF EXPENDITURE → What are the key drivers of expenditure? • • • • Customer Connection – a customer wanting to connect to the network System growth – a part of network where demand is forecast to exceed capacity Asset Replacement and Renewal – asset in in poor condition that need replacing Fault and Emergency Maintenance – the number of faults → Identifying the key drivers of expenditure already set out in the current AMP guidance → Is it possible to develop templates which tabulate the key drivers in some consistent way that can be linked to levels of expenditure? → For example: • • Schedule of asset conditions by asset (consistent with the asset data and expenditure schedules) Schedule of zone substation demand relative to capacity (taking account of future demand growth) 30 NETWORK DATA → Currently EDB AMPs require for each asset category: • • • Description and quantity of assets Description of voltage levels Age profiles → Could this data be standardised into a consistent spreadsheet format common to all businesses? • • • • A standard schedule of asset types and voltages would need to be developed Much simpler than ODV — may be only 15–30 asset categories Ideally aligned with the way expenditure is disaggregated Could also be used to capture volume of activity (i.e. number of asset replaced) → What information could be provided on topology to understand how the network is configured to supply customers, acknowledging differences in: • • • Customer density and demand density Different terrain (urban, rural, remote, rugged ,etc.) Understanding the 11 kV network key - backbone of the network 31 PERFORMANCE → Current ID and/or AMP requirements required reporting of: • Consumer oriented performance targets (SAIDI, SAIFI, CAIDI, etc.) • Asset performance information, e.g. fault rates → Is there enough information to: • • • Link performance to service requirements and in turn to the drivers of investment? Understand the impact of expenditure on performance? Make fair performance comparisons between companies → Consumer oriented performance targets based on system average: • • Possible Average measures provide very limited information on the drivers of good or poor performance development of feeder performance measures (FAIDI and FAIFI) → Can reporting of asset performance measure (fault rates, etc.) be standardised? 32 ASSET MANAGEMENT PLANS → Maintain requirements to disclose an asset management plan → Start point for AMP requirements will be existing requirements, modified where required: • • Some requirements superseded by annual disclosure of standardised template information (i.e. the asset management information) Align planning year to company balance date → Requirements updated to include: • • • • • Assessment of asset management maturity (AMMAT) Reporting of innovation Resilience/HILP Energy efficiency improvements Possible move to biennial disclosure → Key question how is the AMP and the template information are integrated • • Included in the AMP (appendix) Standalone 33 SESSION 4: ASSESSING RELATIVE EFFICIENCY This session will cover: → → → → → → Introduction What we mean by ‘cost efficiency’ Assessing operating expenditure Assessing capital expenditure Assessing total expenditure Case study 34 ASSESSING COST EFFICIENCY: INTRODUCTION 35 → Examining supplier performance has a number of benefits, e.g.: • • • Suppliers may identify better ways of running their businesses from their peers Shareholders or consumer owners better informed about how well their business is being managed, thereby improving their ability to govern the business effectively The Commission can assess whether suppliers are operating efficiently → We have a duty under Part 4 to publish a summary and analysis of disclosed information. An assessment of cost efficiency will form one component of the summary and analysis • We are also considering how to assess other components of performance, and will seek input from interested parties on these in due course → This presentation and accompanying paper set out our thinking to date on approaches for assessing supplier cost efficiency • The views presented are preliminary and do not provide a definitive view on our approach → The approaches and likely data requirements will be discussed in the technical reference groups WHAT DO WE MEAN BY COST EFFICIENCY? 36 → Can a supplier reduce its expenditure while maintaining the same outputs (and quality) in the longer term? → In regulated sectors, assessments of cost efficiency often use other suppliers in the sector as a benchmark (i.e. comparative efficiency assessments) • This approach requires network characteristics that impact on costs (e.g. geography, climate, size of network) to be taken into account so as not to confuse inefficiency with differences in operating circumstances outside management control → Comparisons with other sectors and approaches based on engineering theory and network insight (i.e. indirect comparisons) provide an alternative approach to assessing cost efficiency • These approaches may be appropriate in the absence of a sufficient number of comparable suppliers with robust data ASSESSING OPERATING EXPENDITURE (1) 37 → Based on our preliminary assessment, we propose that where possible, assessments of EDB or GPB opex are made relative to other EDBs or GPBs → There are a sufficient number of New Zealand EDBs to allow an assessment of EDB opex using comparative efficiency techniques → The limited number of GDBs and GTBs means that data from international comparators or sub-company data is likely to be required • • Insights from comparing domestic GPBs may be limited and assessments of relative performance using statistical techniques may not be valid International comparator data is potentially available from the US Federal Energy Regulator and from the Australian Energy Regulator ASSESSING OPERATING EXPENDITURE (2) → A comparative efficiency approach will require the identification of the drivers of costs across the industry, as well as any supplier-specific factors → Different components of opex have different drivers. A high level aggregation could make it difficult to identify the drivers • More disaggregated analysis may be better able to explain differences in costs across suppliers 38 ASSESSING CAPITAL EXPENDITURE 39 → Direct comparisons of capex between suppliers of limited usefulness • Capex driven by network needs, which are likely to be unique to each supplier and thus incomparable across the industry → Furthermore, where possible, we are keen to avoid an assessment of capex based on historic expenditure • • • Capex is driven by needs of network at the time and an assessment based on one or several years’ of data may not be representative Historic capex may bear little relationship to future expenditure (e.g. due to historic underinvestment) We do not consider it appropriate to revisit sunk costs with the benefit of hindsight → Our proposed approach uses an engineering-based assessment of the level of activity proposed combined with comparisons of forecast unit capex (see next slide) → Much of the data required to apply the proposed approach is already provided in EDB AMPs (and will be provided in GPB AMPs). However the data is currently not standardised or provided in a user-friendly format What are the key assets/activities for review in the capex forecast? What drives this activity? (e.g. capacity, asset condition) What is the forecast level of these drivers? (e.g. demand forecast) What is the forecast unit cost of each activity? (i.e. forecast expenditure:forecast volume of work) Assess level/quantity proposed given these forecasts Benchmark unit costs (intra- and inter- operator) Efficient expenditure What is the likely effectiveness of this expenditure? (e.g. increased capacity) ASSESSING TOTAL EXPENDITURE → Up to this point, discussion focused on assessing opex and capex separately using different approaches → However, this may not provide an accurate assessment of supplier efficiency if there are significant opex-capex trade-offs → To mitigate this issue, costs may be aggregated prior to assessment: • • Assess total expenditure Assess combined components of opex and capex where significant trade-offs are identified → Potential approaches for assessing aggregated costs: • • • • Comparative efficiency approach Engineering assessment of the level of activity proposed combined with unit cost comparisons Nature-of-work comparisons Reference model 41 CASE STUDY: COMPARING EDBS DATA AND APPROACH → Comparisons of total opex less pass-through costs across EDBs using information disclosure data for the period 2008-2010 and pass-through cost data from EDB compliance statements → Analysis uses unit costs, scatter plots and simple regression analysis → Intended as an illustration of the techniques we think are appropriate for assessing opex efficiency, and to highlight where additional information is required → This analysis is not intended as an assessment of EDB cost efficiency 43 OPEX PER KM OF CIRCUIT (AVERAGE 2008-2010) 44 High unit costs for EDBs 10, 26, 28 and 29 appear to be driven to some degree by high ICPs per km of network (see next slide) EDBs have high unit costs given ICPs per km of circuit EDBs with the highest unit costs also have the most densely connected networks OPEX PER ICP (AVERAGE 2008-2010) 46 Relatively high opex per ICP at EDBs 4, 15 and 25 EDBs 4 and 5 EDB 25 appears to be unique in terms of network topology EDB 25 High unit costs for EDBs 4 and 15 driven by operating a higher voltage network? Or is this a proxy for some other costly network characteristic? EDBs 4 and 15 Line of best fit and high voltages observed at EDBs 8 and 18 suggest unit costs could be lower? EDBs 8 and 18 OPEX PER GWH SUPPLIED High unit cost at EDB 21 due to low energy consumption per ICP? 49 EDB 21is ranked third lowest in terms of energy consumed per ICP, behind EDBs 15 and 16 However, unlike EDBs 15 and 21, EDB 16 does not appear to have a particularly high unit cost OPEX REGRESSION ANALYSIS ln OPEX = 1.87 + 0.56 ln(km of circuit) + 0.37 ln(GWh distributed) + 0.02 ICPs per km of circuit → Simple model similar to those used by other regulators → Model explains 92% of the variation in opex between EDBs and years → However does not account for company-specific factors which may affect costs (e.g. topology) 50 USING REGRESSION ANALYSIS TO ASSESS RELATIVE COST EFFICIENCY 51 A Cost Line of best fit = average benchmark Inefficiency? B Most efficient EDB? Output Highly variable unit costs at EDB 15 Unit costs appear to have increased for many of the EDBs since 2008 SESSION 5: NEXT STEPS This session will cover: → Process and topics for submissions → Reference groups 54 NEXT STEPS: POST BRIEFING SUBMISSIONS → We invite post briefing submissions, specifically focussing on the questions set out in the paper “Approaches for Understanding EDB and GPB Cost Efficiency” → Section 6 of that paper sets out requirements for submissions → We should receive: • Submissions no later than 5pm on Friday 4 November 2011 and • Cross-submissions no later than 5pm on Friday 18 November 2011 → Submissions should be sent to: [email protected] or Anna McKinlay Chief Advisor Regulation Branch Commerce Commission P.O. Box 2351 Wellington 55 NEXT STEPS: REFERENCE GROUP (1) → The purpose of the reference groups is to provide technical input to help us develop specific information requirements that are sufficient and cost-effective → We are looking for technical input from individuals with working knowledge of the sector, who can advise on the workability of information requirements → All parties will have an opportunity to submit on all proposed ID requirements, including those covered by the reference groups, when we release the draft ID determinations in December 56 NEXT STEPS: REFERENCE GROUP (2) Function of the groups: → Provide technical comment / advice / suggestions to assist us in developing information requirements as an input to the draft ID determinations → Topics we will seek reference group input on include: • • • • • Required asset management information (see slide 21), and standardised templates and definitions Key drivers of opex and capex for EDBs, GDBs, GTBs Optimal level of detail for information disclosure requirements (how disaggregated should the information be?) How AMP requirements should interface with information disclosure templates, and implications for timing and frequency of AMPs Current availability of information, and business impacts where proposed information is not readily available 57 NEXT STEPS: REFERENCE GROUP (3) Form of reference groups: → Small and informal → Individuals with operational knowledge of EDBs and GPBs respectively, in particular: • • Engineering / asset management knowledge Financial management / accounting → We propose to have a single reference group across EDBs and GPBs • On some topics, we may seek input from subsets of the group by sector or topic (e.g. quality measures) 58 NEXT STEPS: REFERENCE GROUP (4) We have established the reference group with input from the industry Indicative reference group membership: → Graeme Wilson (Orion) → Lynne Taylor / Aaron Webb (PwC, on behalf of the ENA) → Ryno Verster (Vector) → Karen Frew (Powerco) → Brent Norris (The Lines Company) → Greg Buzzard (PowerNet) → Geoff Evans (GasNet) → Jelle Sjoerdsma (MDL) 59