Vote: Energy
Output Class - Policy Advice on Energy and Resource Issues
Description
This output class provides policy advice to ensure the operation of energy and resource markets (electricity, oil, gas, geothermal, coal, minerals and other natural resources) is efficient and meets government objectives.
Quantity, Quality, Timeliness and Cost
Work Programme
All policy advice projects were delivered in accordance with the terms of the work programme as agreed with the Minister. Changes to deadlines were negotiated with the Minister.
Key Deliverables in the Work Programme for 2003/2004
Electricity Market
Review industry arrangements and policy settings to promote investment and ensure security of supply, focusing on the following activities:
Efficient management of security of supply, including dry-year risk.
Reserve generation at Whirinaki was secured for 2004. In advance of the full establishment of the Electricity Commission, a project to enhance the security of electricity supply for 2004 was implemented.
Effective governance of the electricity sector.
The Electricity Commission was established on 15 September 2003. The electricity governance rules and regulations have been gazetted and contracts signed with service providers who will administer the electricity market under the rules and regulations.
Effective wholesale and retail competition.
Regular monitoring and reporting to the Minister on retail competition and electricity prices took place throughout the year.
Efficient line services (including transmission security and efficient prices).
Part F of the Electricity Governance Rules relating to investment in and pricing for use of the national grid came into force on 28 May 2004. Part F covers transmission agreements, transmission pricing, grid upgrade plans and financial transmission rights. Regulations were passed confirming Transpower's transitional pricing methodology until such time as the Electricity Commission authorises a pricing methodology.
Gas Market
Gas industry governance and market arrangements are implemented by market participants to promote a smooth transition to the post-Maui environment, focusing on the following activities:
Monitoring and facilitating industry progress in implementing the Government Policy Statement objectives.
A revised Government Policy Statement, detailing important milestone dates for industry to meet, was drafted and forwarded to industry stakeholders in July 2004 for their comments.
Security of supply in the gas sector.
Proposed incentives to encourage petroleum exploration (particularly gas) were agreed by Cabinet on 14 June 2004. Royalty-based incentives have been included in the draft Minerals Programme for Petroleum which is expected to come into effect on 1 January 2005. Other measures to encourage exploration were being developed at year-end.
Effective governance of the gas sector.
Legislation containing powers for co-regulation in the gas industry had been reported back to Parliament by year-end and is expected to be passed in the first half of 2004/2005.
Effective wholesale market arrangements.
The Government's requirements regarding gas wholesale market arrangements have been reaffirmed as part of the revised Government Policy Statement.
Open access to the Maui pipeline.
Complex negotiations on the Maui gas contracts were completed. The Ministry is continuing to monitor progress on the development of open access arrangements. These are expected to be in place by March 2005.
Projects Not Included in the 2003-2006 Statement of Intent
Resource Management Act
The Ministry developed and provided four substantive submissions under the Resource Management Act (RMA) in support of renewable energy projects, particularly wind and geothermal. The Ministry also actively contributed to the RMA review initiated in 2004.
Sustainable Development Programme of Action for Energy
Significant progress was made on developing a sustainable energy paper intended for public release in the first half of 2004/2005. The process is a whole-of-government exercise being led by the Ministry. The purpose of the paper is to explain the Government's strategic direction in energy policy and to discuss the opportunities and challenges facing New Zealand's energy system going forward.
In 2003/2004, progress was also made towards "institutionalising" a sustainable development approach (i.e. a more integrated approach) to energy policy. Example initiatives include thinking about shared outcomes in the context of sustainable energy and holding cross-agency "show and tells" on sustainable energy policy priorities.
Crown Entity Monitoring
Advice was provided to the Minister on statutory appointments to the Electricity Commission board, prior to its establishment on 15 September 2003.
A total of six appointments were made within the agreed timelines. Board appointments were completed by 30 September 2003.
Monitoring and reporting to Ministers on the financial and non-financial performance of the Electricity Commission was provided as reflected through:
- the Statement of Intent;
- the Output Plan; and
- management reports (for reference as appropriate to the Minister).
Cost
(Figures are GST exclusive)
| | 2004
Main
Estimates | 2004
Supple-
mentary
Estimates | 2004
Actual | 2003
Actual |
| | $000 | $000 | $000 | $000 |
| Revenue: | | | | |
| Crown | 3,861 | 6,250 | 5,870 | 3,173 |
| Other | 185 | 97 | 31 | 47 |
| Total Revenue | 4,046 | 6,347 | 5,901 | 3,220 |
| Expenses: | | | | |
| Annual appropriations | 4,046 | 6,347 | 5,901 | 3,220 |
| Other appropriations | - | - | - | - |
| Total Expenses | 4,046 | 6,347 | 5,901 | 3,220 |
| Net Surplus/(Deficit) | - | - | - | - |
Sources of Revenue Other
| | 2004
Actual | 2003
Actual |
| | $000 | $000 |
| Cost recovery | 12 | 47 |
| Inter-departmental cost recovery | 4 | - |
| Miscellaneous | 15 | - |
| Total Revenue Other | 31 | 47 |
Major Budget Variances
The Supplementary Estimates change ($2.301 million) reflected funding for establishing the Electricity Commission ($853,000), funding to enhance security of electricity supply for 2004 ($716,000), funding for policy work on the purchase of a reserve electricity generation plant ($460,000), and transfers to meet residual cost pressures ($360,000), partly offset by a transfer of funding for petroleum monitoring and testing (-$88,000).
The variance between Supplementary Estimates and actual expenses was mainly due to provision made for additional work on security of electricity supply if Winter 2004 was dry not being required. An "in principle" expense transfer has been approved to allow for the carry-over of partial funding into 2004/2005.
The variance between 2003/2004 and 2002/2003 actual expenses includes additional funding for the establishment of the Electricity Commission ($0.783 million), and new policy advice funding including for advice on reserve electricity generation, security of electricity supply for 2004 and an integrated approach to freshwater management and allocation ($1.569 million). In addition funds were transferred to this output class from Vote Communications Policy Advice Communications ($0.130 million) and from Vote Energy Administration of Gas and Electricity Regulations ($0.110 million).
Output Class - Management of the Crown Mineral Estate
Description
This output class provides services relating to the management of Crown-owned minerals under the Crown Minerals Act 1991 and minerals programmes issued under this Act.
The Crown owns all in-ground petroleum, gold and silver in New Zealand and approximately half of the coal and other mineral resources. It also has jurisdiction of the petroleum and minerals in New Zealand's exclusive economic zone and continental shelf.
Quantity, Quality, Timeliness and Cost
Performance standards for outputs other than policy advice are in brackets where applicable.
Work Programme
All policy advice projects were delivered in accordance with the terms of the work programme as agreed with the Minister. Changes to deadlines were negotiated with the Minister.
Policy and strategic advice on the petroleum and minerals sector.
Advice provided on policies that impact on the Crown mineral estate included reviewing the proposed Foreshore and Seabed Bill and consequential amendments to the Crown Minerals Act, advice on access to Crown Land processes for minerals, reviewing various district and regional plans, and advocacy for mineral issues where appropriate.
Review Crown Minerals legislation and pursuing legislative changes.
A Crown Minerals Amendment Bill was enacted on 21 August 2003.
Review of the Minerals programme.
A petroleum policy statement was approved by Cabinet in June 2003 and initial discussions were held with industry. At 30 June 2004 preparation of a draft replacement programme was complete, approved by Cabinet and released for public consultation.
Management of the Geoscience Resource Data Library
Quantity
169 (145) records and reports received from petroleum and minerals holders were entered into the resource data library.
Timeliness
99% (90%) of resource data information requests were responded to within five clear business days of receipt.
Permit Allocation and Management
Quantity
Applications processed:
- 170 (165) permit applications; and
- 152 (220) permit change applications.
Volumes are demand driven. In addition, 2003/2004 was the first year that new applications and permit change applications have been reported separately.
Quality
Permits will be monitored for compliance with conditions to ensure the integrity of the allocation system and action will be taken where there is evident non-compliance. (Annual work statements and technical reports are checked against the conditions of the permit to ensure that permit holders are meeting their obligations and the work is allowed for by the permit.)
347 (440) permits were monitored for compliance with conditions as follows:
- all (all) petroleum permits were reviewed for compliance with conditions on work programme milestones (96 exploration and prospecting permits and 12 mining permits);
- 185 (250) minerals mining permit work statements were reviewed and approved; and
- 54 (120) minerals prospecting and exploration permit work programme commitments were reviewed based on annual activity reports.
The lower numbers of minerals mining permit work statements and minerals prospecting and exploration permit work programme commitments reviewed were due to rebuilding the Crown Minerals Group post-review and reassessment of the compliance strategy and priorities in accordance with the review recommendations. A shift of focus to higher value producers, simplifying procedures and reducing compliance costs are now the focus.
Timeliness
52% (90%) of new permit applications were processed within an average time of six months of receipt.
63% (90%) of permit change applications were processed within three months of receipt (excluding applications for extension of area).
90% (90%) of mining permit work statement reviews were undertaken within 30 clear business days of receipt.
Delays in processing new permit and permit change applications were due to lost capability during the Crown Minerals Group review and rebuilding of the group post-review. Re-engineering of permit processes was completed by year-end and turnaround times had been reduced.
Crown Revenue Collection
Quantity
Amounts collected:
- Royalties - $43.7 million ($33.3 million);
- Energy resource levies - $74.6 million ($86.3 million).
The Ministry collected $43.7 million in royalties, on behalf of the Crown, as required by the conditions of permits. The increase above forecast is due to higher crude oil prices more than offsetting lower production of gas.
Levies of $74.6 million were collected on behalf of the Crown, under the Energy Resources Levies Act. Actual levies collected were lower than forecast because of high lake levels and availability of hydroelectricity reducing the demand for gas fired electricity generation. Energy resource levies are based on the production of gas.
Quality
Undertake a minimum of 10 compliance audits of energy resource levy or royalty payers within five months of receipt of annual royalty or levy and pursue any shortfalls.
The Ministry undertook six compliance audits of significant energy resource levy or royalty payers. The failure to complete 10 compliance audits was due to reduced capacity during the Crown Minerals Group review.
Timeliness
98% (95%) of royalties were collected within one month of due date.
96% (90%) of fees were collected within two months of due date.
Cost
(Figures are GST exclusive)
| | 2004
Main
Estimates | 2004
Supple-
mentary
Estimates | 2004
Actual | 2003
Actual |
| | $000 | $000 | $000 | $000 |
| Revenue: | | | | |
| Crown | 2,184 | 2,184 | 2,184 | 2,098 |
| Other | 3,536 | 3,536 | 3,203 | 2,799 |
| Total Revenue | 5,720 | 5,720 | 5,387 | 4,897 |
| Expenses: | | | | |
| Annual appropriations | 5,626 | 5,626 | 5,643 | 5,102 |
| Other appropriations | - | - | - | - |
| Total Expenses | 5,626 | 5,626 | 5,643 | 5,102 |
| Net Surplus/(Deficit) | 94 | 94 | (256) | (205) |
Sources of Revenue Other
| | 2004
Actual | 2003
Actual |
| | $000 | $000 |
| Petroleum | 1,284 | 1,300 |
| Minerals/mining | 1,002 | 1,150 |
| Coal permit annual fee | 342 | 158 |
| Conferences | 377 | - |
| Other fees | 178 | 150 |
| Total fees | 3,183 | 2,758 |
| Inter-departmental cost recovery | 6 | - |
| Miscellaneous | 14 | 41 |
| Total Revenue Other | 3,203 | 2,799 |
Major Budget Variances
The variance between the Supplementary Estimates and actual Revenue Other reflects lower than forecast numbers of permit applications received.
The variance between 2003/2004 and 2002/2003 actual Revenue Other reflects revenue from the Crown Minerals Conference/New Zealand Petroleum Conference 2004 held in 2003/2004. The conference is hosted bi-annually, therefore no conference fees were received in 2002/2003.
The variance between 2003/2004 and 2002/2003 expenses reflects expenditure relating to the Crown Minerals Conference/New Zealand Petroleum Conference 2004 held in 2003/2004 and expenditure associated with the review of the Crown Minerals Group, partly offset by one-off savings due to a short-term reduction in staff numbers in the Crown Minerals Group during the review.
Output Class - Administration of Gas and Electricity Regulations
Description
This output class provides advice on the administration of the gas and electricity safety, supply quality and measurement regimes; a petroleum quality monitoring regime; administers electrical worker licensing; and administers information disclosure regimes for the gas and electricity industries.
Quantity, Quality, Timeliness and Cost
(Performance standards are in brackets where applicable.)
Gas and Electricity: Safety, Quality and Monitoring
Quantity, Quality and Timeliness
Implement the EnergySafe programme with the provision of drafting instructions for the Energy Safety Review Bill to the Parliamentary Counsel Office (PCO).
The key milestone dates required of the Energy Safety Service in the EnergySafe programme for legislative change will be met.
Ministerial approval was obtained on 28 February 2004 to defer submission of amendments to Cabinet LEG by 31 March 2004, subject to PCO resourcing. This delay was due to the diversion of the Ministry's legal staff to higher priority projects during the year (e.g. building regulatory work). However, drafting instructions were completed and provided to the PCO on 8 June 2004. The EnergySafe legislation will now be progressed in 2004/2005.
The drafting instructions provided to the PCO for the Energy Safety Review Bill will be agreed by electrical and gas safety representative organisations before sign-off to the PCO.
Substantially finalised drafting instructions were fully consulted upon by 30 June 2004.
Other Activity for 2003/2004
Quantity
85 (75) electricity standards and three (4) gas standards were published under funding contracts with Standards New Zealand. (The target for electricity standards was exceeded to improve quality by including additional international standards. A gas standard on Guidelines for Assessment of Gas Appliances was in draft at year-end, to be completed by 30 September 2004.)
No electrical codes (2) or gas codes of practice (1) were published. (The two electrical codes planned (on homeowner work) were not completed as the drawing of detailed diagrams, critical to the codes, has taken longer than expected. This work is being undertaken by Standards New Zealand. The codes are expected to be published by 31 October 2004. A planned update of a gas code was not initiated due to lack of interest by the industry. This assessment was supported by the Energy Safety Service.)
64 (90) audits and inspections of gas and electricity appliances, installations and networks and distribution systems were undertaken. (The reduced number of audits and inspections was because resources were diverted to dealing with a higher than expected number of accidents.)
No (1) additional international agreements were concluded. (Finalisation of an agreement with Taiwan was not achieved due to a changed priority in the Ministry of Foreign Affairs and Trade timetable.)
209 (80-100) gas and electricity accidents and incidents were investigated. No clear reason for the increase has been identified.
Timeliness
95% (90%) of audit, inspection and accident investigation reports were completed within 30 working days of audit, inspection or receipt of accident notification.
Quality
Electrical and gas safety representative organisations surveyed rate, on average, that they are (3) satisfied to (4) very satisfied with the Energy Safety Service's performance, as evidenced by an annual survey.11
Responses received rated an average of 3 (satisfied).
Petroleum Monitoring
Quantity
278 (250) petroleum monitoring tests were undertaken. (This performance standard has been reviewed and revised for 2004/2005.)
Timeliness
The petroleum monitoring programme annual report will be published by 30 September 2003.
A decision was made to delay publication of the petroleum monitoring programme annual report to allow incorporation of additional information related to the implementation of new regulations. The report was published on 29 March 2004.
Quality
Petroleum companies and sampling laboratories surveyed rate, on average, that they are (3) satisfied to (4) very satisfied with the Energy Safety Service's performance, as evidenced by an annual survey.12
The Energy Safety Service (ESS) has reconsidered the approach taken in this area. Gathering feedback on ESS performance from agencies under contract to ESS is not seen to add value and as a result the annual survey was not conducted. New performance measures have been put in place for 2004/2005, which focus more clearly on ensuring that the agencies with which ESS contract to undertake petroleum monitoring over the course of this year undertake their monitoring to an acceptable standard, particularly with respect to timeliness.
All (100%) prosecution and prohibition processes met legal and policy requirements.
Electrical Workers Licensing
Quantity
1,534 (1,000) electrical workers' registrations were actioned.
20,787 (20,500) practising licenses were issued.
6,084 (5,000) telephone competency audits of registered electrical workers who had not uplifted a practising licence were conducted.
224 (200) competency audits of electrical workers who held a provisional licence and/or were supervised trainees were conducted.
Electrical workers' registrations are demand driven. The increase in 2003/2004 is due to more apprentices completing their training, immigration, and line mechanics re-registering.
The increase in the numbers of audits conducted is due to a more streamlined process resulting in more audits being able to be carried out within budget.
Quality
All (all) decisions by the Registrar that were referred to the Electrical Workers Registration Board complied with the Electricity Act 1992 and Electricity Regulations 1997 and with published policies.
Timeliness
Licensing and Registrations:
- 100% (95%) of correctly completed practice licensing applications were processed within 10 clear business days of receipt;
- 100% (95%) of correctly completed registration applications (applying through the Electro Technology Industry Training Organisation or as New Zealand based trainees) were processed within 10 clear business days of receipt; and
- 65% (65%) of correctly completed overseas applications for registration were processed within 10 clear business days of receipt.
Complaints:
- 95% (95%) of complaints against registered electrical workers were processed to notification of the Board's and/or Complaints Assessment Committee decision as appropriate (subject to external parties, e.g. legal intervention) within 25 weeks.
Information Disclosure
Quantity and Timeliness
Undertake annual compliance checks of all gas and electricity information disclosures, with 80% of checks completed within 60 working days of their receipt by the Ministry.
80% of initial checks of electricity distribution companies' annual financial and performance measure disclosures were completed within 60 days. Transpower and gas disclosure checks were completed. Some gas disclosure checking was delayed as a result of a focus on checking electricity disclosures. However, 66% of gas disclosures were checked within 70 days of receipt by the Ministry.
Follow up any cases of non-compliance with the companies concerned within 30 working days of the non-compliance being detected, with the aim of achieving full compliance within 120 working days of the detection (note in some cases it is possible that prosecution could be required in order to achieve full compliance, and as a result there could be a considerable delay before full compliance is achieved).
All cases of detected non-compliance regarding disclosures were followed up within the timeframe, with the exception of three cases where follow-up was completed within 40 working days of detection.
Review the residual need for electricity disclosure regulations and make recommendations to the Minister, by 31 December 2003 (the main function of the regulations is to pass to the Commerce Commission).
A report reviewing the need for the Electricity (Information Disclosure) Regulations 1999 (the Regulations) was provided to the Minister on 10 October 2003 recommending that the Regulations be revoked. The Regulations were subsequently revoked from 6 April 2004. The Commerce Commission's Electricity Information Disclosure Requirements 2004 were gazetted on 31 March 2004.
Produce an annual report on electricity line company performance for the 2002/2003 year by 31 December 2003.
Publication of the report was delayed to April 2004 with Ministerial approval to allow incorporation of corrections to data that was disclosed for 2002/2003. The report was published on 16 April 2004 and is also available on the Ministry of Economic Development's web site.
Quality
All financial information disclosures were accompanied by an audit certificate.
All information disclosures were accompanied by a declaration form completed by a Director of the company concerned.
All information entered into the Ministry database was subject to validation checks for accuracy and completeness.
All reports to the Minister were reviewed internally for completeness and accuracy.
Cost
(Figures are GST exclusive)
| | 2004
Main
Estimates | 2004
Supple-
mentary
Estimates | 2004
Actual | 2003
Actual |
| | $000 | $000 | $000 | $000 |
| Revenue: | | | | |
| Crown | 895 | 785 | 648 | 870 |
| Other | 7,420 | 7,508 | 7,657 | 7,137 |
| Total Revenue | 8,315 | 8,293 | 8,305 | 8,007 |
| Expenses: | | | | |
| Annual appropriations | 8,226 | 8,204 | 7,945 | 7,906 |
| Other appropriations | - | - | - | - |
| Total Expenses | 8,226 | 8,204 | 7,945 | 7,906 |
| Net Surplus/(Deficit) | 89 | 89 | 360 | 101 |
Sources of Revenue Other
| | 2004
Actual | 2003
Actual |
| | $000 | $000 |
| Certificate of compliance sales | 1,004 | 893 |
| Practising licence fees | 1,708 | 1,374 |
| Other electrical workers licensing group fees | 386 | 320 |
| Electrical levies | 3,333 | 3,390 |
| Gas levies | 837 | 796 |
| Petroleum fuels monitoring levy | 366 | 320 |
| Total fees and levies | 7,634 | 7,093 |
| Cost recovery | 11 | 44 |
| Inter-departmental cost recovery | 5 | - |
| Net gain on sale of fixed assets | 1 | - |
| Miscellaneous | 6 | - |
| Total Revenue Other | 7,657 | 7,137 |
Major Budget Variances
The Supplementary Estimates changes reflected a transfer of funding to the policy advice output class (-$110,000 Revenue Crown), and a transfer of funding from the policy advice output class for petroleum monitoring and testing ($88,000 Revenue Other) as part of the lower sulphur diesel publicity campaign.
The variance between 2003/2004 and 2002/2003 Revenue Other mainly reflects two national publicity awareness programmes and an increase in the numbers of audits conducted by the Electrical Workers' Licensing Group resulting in increased revenue from electrical workers' practising licence fees and compliance certificates.
Output Class - Provision of Climate Change Unit Register and Information
Description
This output class provides services relating to the development and implementation of a national climate change unit register to enable international trading in emissions units and sink credits under the Climate Change Response Act 2002. It will provide for services relating to registration and provision of information as required by the Act in 2005/2006, which is the expected implementation timeframe for the register.
Quantity, Quality, Timeliness and Cost
The work programme which will be delivered as agreed with the Minister and as detailed in the Ministry of Economic Development Output Plan is expected to include the following activities.
Contribute to the development of international technical standards relating to the exchange of data between registry systems through participation in international negotiations and conferences.
The Ministry provided feedback throughout the year to the United Nations Framework Convention on Climate Change (UNFCCC) as they prepared documentation on the Transaction Log and the Data Exchange Standards.
Development of business requirements for a New Zealand national unit register by 30 June 2004.
Work on the business requirements for the New Zealand register is dependent on the UNFCCC completing their documentation for the Data Exchange Standards.
Quality
Detailed business specifications will be developed in accordance with Ministry standards and practices for information technology projects, with delivery and reporting against agreed milestones.
Business specifications were not developed as work on the business requirements for the New Zealand register is dependent on the UNFCCC completing their documentation for the Data Exchange Standards.
Cost
(Figures are GST exclusive)
| | 2004
Main
Estimates | 2004
Supple-
mentary
Estimates | 2004
Actual | 2003
Actual |
| | $000 | $000 | $000 | $000 |
| Revenue: | | | | |
| Crown | 427 | 427 | 82 | - |
| Other | - | | - | - |
| Total Revenue | 427 | 427 | 82 | - |
| Expenses: | | | | |
| Annual appropriations | 427 | 427 | 82 | - |
| Other appropriations | - | - | - | - |
| Total Expenses | 427 | 427 | 82 | - |
| Net Surplus/(Deficit) | - | - | - | - |
Major Budget Variances
The Supplementary Estimates reflect funding for services relating to the development and implementation of a national unit register to enable international trading in emissions units and sink credits under the Climate Change Response Act 2002.
The variance between Supplementary Estimates and actual expenses is due to lack of progress in developing the business requirements for the New Zealand register as this work is dependent on the UNFCCC completing their documentation for the Data Exchange Standards.
The variance between 2003/2004 and 2002/2003 for expenses is due to this being a new output class in 2003/2004.
Output Class - Energy and Resource Information Services
Description
This output class covers the provision of information and technical advice on energy and resources, the management of the response to any international disruption in oil supplies, and the management of New Zealand's energy-related international relations.
Quantity, Quality, Timeliness and Cost
Key Deliverable in the Work Programme for 2003/2004
Establish arrangements for electricity security of supply modelling and publish quarterly reports on future supply risks by 30 September 2003, 31 December 2003, 31 March 2004 and 30 June 2004.
Quarterly reports were published on 14 September 2003 and 12 December 2003. In the second half of the year an extensive series of weekly updates were provided to the Minister on the current security situation. Regular public updating on security of supply was provided via a dedicated website.
Other outputs for 2003/2004 included the following:
Collecting and compiling a wide range of energy data (in particular on price movements) for the purpose of keeping Ministers informed on the performance of energy markets and publishing related information for the purpose of keeping energy producers and consumers informed.
Quarterly reports were provided to the Minister in accordance with agreed timelines. Eleven additional reports were provided to the Minister relating to various aspects of electricity prices and competition. A report on gas prices was also provided.
Collect and compile an inventory of energy sector greenhouse gas emissions for the purpose of meeting international reporting obligations and publishing related information for the purpose of keeping energy producers and consumers informed.
The annual inventory of energy sector greenhouse gas emissions was completed during the year and released by the Minister in July 2004. Energy sector inventory information for international reporting was provided to the Ministry for the Environment (Climate Change Office).
Prepare energy sector forecasts for the purpose of keeping Ministers informed on energy security and likely future energy sector scenarios and publishing related information for the purpose of keeping energy producers and consumers informed.
The Energy Outlook, containing long-term energy sector scenarios, was published in October 2003.
Manage New Zealand's response to any international disruption to oil supplies.
Measures were in place throughout the year to deal with any disruption to oil supplies. (No disruption occurred.)
Managing New Zealand's energy international relations.
Managing New Zealand's energy international relations during 2003/2004 included:
- Involvement with the International Energy Agency (IEA) including responses to requests for information/statistics and representation at IEA meetings;
- Relations with the APEC Energy Working Group (EWG) including maintaining close contact with the Energy Business Network and involvement in a number of APEC-funded projects;
- Representing New Zealand at the EWG meeting in Seoul in December 2003 and supporting the Associate Minister's attendance at the APEC Energy Ministers' meeting in the Philippines in June 2004.
Quantity and Timeliness
Energy and resource information services were delivered as agreed with the Minister and detailed in the Ministry of Economic Development Output Plan.
Quality
All material produced was internally reviewed for completeness and accuracy prior to publication.
Cost
(Figures are GST exclusive)
| | 2004
Main
Estimates | 2004
Supple-
mentary
Estimates | 2004
Actual | 2003
Actual |
| | $000 | $000 | $000 | $000 |
| Revenue: | | | | |
| Crown | 1,306 | 1,231 | 930 | 676 |
| Other | 975 | 975 | 1,007 | 1,017 |
| Total Revenue | 2,281 | 2,206 | 1,937 | 1,693 |
| Expenses: | | | | |
| Annual appropriations | 1,306 | 1,231 | 930 | 676 |
| Other appropriations | 966 | 966 | 1,003 | 1,011 |
| Total Expenses | 2,272 | 2,197 | 1,933 | 1,687 |
| Net Surplus/(Deficit) | 9 | 9 | 4 | 6 |
Sources of Revenue Other
| | 2004
Actual | 2003
Actual |
| | $000 | $000 |
| Petroleum fuels monitoring levy | 959 | 991 |
| Sale of publications | 46 | 26 |
| Inter-departmental cost recovery | 2 | - |
| Total Revenue Other | 1,007 | 1,017 |
Major Budget Variances
The Supplementary Estimates decrease reflects a transfer of funding to the policy advice output class for security of the electricity supply for 2004 (-$275,000), partly offset by a transfer from 2002/2003 to 2003/2004 for electricity modelling and security of supply risks ($200,000).
The variance between the Supplementary Estimates and actual expenses reflects recruitment problems that delayed development of the capacity for in-house security of supply modelling for future years. Expenditure budgeted for in-house model development, including associated contracting for technical services was not incurred in 2003/2004.
The variance between 2003/2004 and 2002/2003 actual expenses reflects additional funding for the development of the capacity for in-house security of supply modelling for future years ($831,000) plus funding carried forward from 2002/2003 ($200,000), largely offset by one-off policy and electricity market development work carried out in 2003/2004 and by this output class absorbing part of the costs related to security of electricity supply for 2004.
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