34. The Ministry proposes that pipeline owners be required to disclose asset management plan (AMP) information for their gas networks. In summary, the Ministry proposes that the AMP disclosures contain information on the following:

Background and objectives;
The date the information was completed and the period to which it relates;
Asset management systems and information;
Network and asset description;
Service level objectives;
Life-cycle asset management and development plans;
Risk assessment; and
Performance and plans for improvement.

35. Details of the proposed AMP information disclosure requirements are provided in Annex 5.

5.1.2 Rationale for Proposal

36. Ensuring the safety and reliability of gas networks is a matter of legitimate public interest. The Ministry considers that disclosure of AMP information would help promote strong incentives to put in place and maintain good asset management practices by pipeline owners, and would assist pipeline owners in demonstrating they follow high standards. In particular, the Ministry expects that disclosure of AMP information would enhance the quality of discussions between pipeline owners and those parties who have the ability and incentive to review the plans, eg major users. A strong measure of peer review within the industry would also be possible following disclosure. The Ministry also expects that disclosure of AMP information would help interested parties analyse the reasonableness of pipeline owners' ODVs, and forecasted service reliability targets.

5.2 Proposed Differences Between the Electricity and Gas AMP Information Disclosure Requirements

5.2.1 Proposed Requirements

37. The Electricity (Information Disclosure) Regulations include AMP disclosure requirements (these were included in Annex 3 of the discussion paper entitled Proposals for Amending the Gas (Information Disclosure) Regulations 1997). The proposed gas AMP information disclosures are based on these, but with key differences.

The gas AMP disclosure requirements make it explicit that the AMP that is required to be disclosed is a document which must contain certain asset management information (practices and performance measures). The form of this information may be an extract(s) from the AMP used in practice or a separate document prepared for AMP disclosure purposes, provided that the disclosed AMP information is consistent with the AMP the utility uses, and contains the information specified.
The gas AMP disclosure requirements do not include development plans and expenditure projections.
The gas AMP disclosure requirements specify that "descriptions" of certain AMP information should be provided, rather than "details".
The gas AMP disclosure requirements for Network and Asset description provide more specificity on what is required, and focuses more on the condition of the assets.
The gas AMP disclosure requirements in relation to performance targets are to be based on the definition used for the service reliability targets specified in Schedule 1 of the Gas (Information Disclosure) Regulations.

5.2.2 Rationale for Proposal

38. The rationale for each of these variations is listed below (in consistent order):

This variation does not result in a difference between the disclosure requirements of the Electricity and Gas (Information Disclosure) Regulations. Rather it is simply intended to make clear what the requirements on gas utilities are. Compliance with the AMP disclosure requirements in the Electricity and Gas (Information Disclosure) Regulations does not mean that full disclosure of AMP documents used in practice is required. Such documents may be extremely bulky, and go well beyond the requirements specified in the Handbook (and include commercially sensitive material). If pipeline owners were required to disclose all such material, they may have incentives to prepare less detailed AMPs for practical use in the future. Clearly such a result would be contrary to the intentions of the AMP disclosure requirements, which is to encourage better and more transparent asset management practices.
Gas networks (at least at the distribution level) arguably face stronger inter-fuel competition, substitutability and risk of bypass than electricity networks. Therefore, commercial information (eg development and expenditure plans) is of potentially greater sensitivity. It should also be noted though that the proposed AMP disclosure requirements include descriptions of the policies and planning processes to create and replace network assets (which will provide information on development plans without raising undue commercial sensitivity issues).
It is considered that in many cases descriptions of asset management policies and practices will be more meaningful to a reader than "details" (as prescribed in the electricity disclosure template), and in some cases actual details may include commercially sensitive information (eg load shedding lists in the emergency response plan).
This is intended to improve on the requirements of the Electricity (Information Disclosure) Regulations, which are very generic in this area.
These performance measures are relevant to asset management planning and, therefore, it makes sense that they be used for asset management targets, rather than leaving their use optional. This approach has been made possible by the proposal to adopt a wider range of reliability performance measures.

5.3 Treatment of Transmission and Distribution Activities Under the AMP Information Disclosure Requirements

5.3.1 Proposed Requirements

39. The Ministry proposes that where a pipeline owner has both distribution and transmission systems the pipeline owner should be required to disclose only one set of AMP information covering all its systems.

5.3.2 Rationale for Proposal

40. The major difference between transmission and distribution systems is pressure (2000 kPa being the threshold), and this results in some different asset management requirements. However, whether AMP information is disclosed separately or combined, it would be expected that the key AMP information relevant to both systems should be disclosed in a way that enables the reader to distinguish between the approaches in the two separate systems.

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Printed: 24/11/2009