5 Oct 2016

NZX spending $5.5m to beef up electricity trading market

7:44 am on 5 October 2016

The Stock Exchange is spending $5.5 million over two years to beef up its trading systems for the wholesale electricity market.

NZX runs New Zealand's wholesale electricity market after buying the firm that ran it previously, M-Co, in 2009.

The market as a whole has just celebrated its 20th birthday, during which time it has done 56 billion trades.

The head of electricity markets at the exchange, Shane Dinnan, said a software upgrade had just begun and one part of it was launched yesterday.

"We are obviously updating the trading systems, but working through a whole lot of ancillary areas as well," he said.

"These include the clearing settlement areas, reconciliation which is the trading of electricity in and out of the grid, and the pricing function as well.

"It is going to provide a lot more ease of trading for market participants. But for consumers it will provide better access to information and it will allow consumers to make more informed decisions as to when to switch retailers or when to stay with a particular retailer," Mr Dinnan said.

New Zealand is the third jurisdiction in the world to establish a wholesale energy market behind England and Wales in 1990 and and Norway in 1993.

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