Vote: Energy
Output Class D1 - Policy Advice on Energy and Resource Issues
Description
Policy advice is provided 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. Outputs in this output class include:
- monitoring and advice to government on effective governance and operation of electricity and gas markets (with particular focus on security of supply) and implementation of regulations as required;
- providing advice to the Government on effective retail competition in the petroleum market;
- leadership of the energy component of the Sustainable Development Plan of Action;
- providing advice on the allocation and management of natural resources, particularly Crown-owned resources, and on Treaty of Waitangi claims in respect of natural resources;
- contributing to policy advice on the development of a response to New Zealand's climate change obligations under the Kyoto Protocol;
- developing a policy framework for bioprospecting in New Zealand; and
- contributing to the development of a policy framework for managing New Zealand's oceans, including policy advice on the regulation of minerals exploration and mining beyond New Zealand's territorial sea.
Service Performance Objectives - Output Class Specific
Generic quantity, quality and timeliness performance measures for all policy advice, ministerial services and briefings supplied by the Ministry of Economic Development are detailed in Quality Standards for Policy Advice and Ministerial Servicing.
Where appropriate, comparative figures for the previous year are shown in parentheses.
2003/2004 Performance Measures and Standards
Policy Advice
Policy advice will be delivered as agreed with the Minister and as detailed in the Ministry of Economic Development Output Plan.
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.
Work will focus on:
- efficient management of security of supply, including dry-year risk;
- effective governance of the electricity sector;
- effective wholesale and retail competition; and
- efficient line services (including transmission security and efficient prices).
Completion of this work will promote achievement of the Government's electricity objectives (as set out in the Government Policy Statement of February 2002), including security of electricity supply. Ensuring security of supply, promoting investment in electricity infrastructure, and promoting competition in electricity markets will ensure that businesses and other consumers have access to the electricity they need at reasonable cost, and that the electricity sector thereby makes its best contribution to economic growth.
Gas Market
Gas industry governance and market arrangements are implemented by market participants to promote a smooth transition to the post-Maui environment.
Work will focus on:
- monitoring and facilitating industry progress in implementing the Government Policy Statement objectives;
- security of supply in the gas sector;
- effective governance of the gas sector;
- effective wholesale market arrangements; and
- open access to the Maui pipeline.
This will promote achievement of the Government's objectives for the gas sector, including facilitating an efficient transition to new energy supplies following the cessation of supply from Maui expected in the next few years. Secure gas supply, including for electricity generation, will help ensure that the electricity and gas sectors play their part in economic development and growth.
Costs: Vote Energy, Output Class D1
| | 2003/2004
Forecast | 2002/2003
Supple-
mentary
Estimates | 2002/2003
Estimated
Actual |
|---|
| | $000 | $000 | $000 |
| Revenue Crown | 3,861 | 3,205 | 3,205 |
| Third Party Revenue | 185 | 47 | 47 |
| Expenses | 4,046 | 3,252 | 3,252 |
| Surplus/(Deficit) | - | - | - |
Output Class D2 - 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.
This output class provides services in maintaining an efficient and effective management regime for the exploration of petroleum, mineral and coal resources and allocating and managing prospecting exploration and mining permits; promotion of investment opportunities in exploration and development of petroleum and minerals; policy and strategic advice on the Crown minerals sector; management of the geoscience resource data library; and collection of royalties, levies and fees related to petroleum and minerals extraction and permits.
The Ministry will manage and allocate property rights for Crown-owned resources efficiently, by:
- maintaining a resource administration regime which creates a competitive advantage for business to invest in New Zealand over other nations;
- ensuring that the allocation methodology for permits is recognised internationally and domestically as being rigorous, effective and timely, thus giving businesses confidence in their allocated property interests; and
- being recognised by the industry as effectively advising on prospecting opportunities.
Service Performance Objectives - Output Class Specific
Generic quantity, quality and timeliness performance measures for all policy advice, ministerial services and briefings supplied by the Ministry of Economic Development are detailed in Quality Standards for Policy Advice and Ministerial Servicing.
Where appropriate, comparative figures for the previous year are shown in parentheses.
2003/2004 Performance Measures and Standards
Policy Advice
Policy advice will be delivered as agreed with the Minister and as detailed in the Ministry of Economic Development Output Plan and will include:
- providing policy and strategic advice on the petroleum and minerals sector;
- reviewing Crown Minerals legislation and pursuing legislative changes; and
- review of the Minerals programme.
Management of the Geoscience Resource Data Library
Quantity
145 (130) records and reports received from petroleum and minerals holders will be entered into the resource data library.
Timeliness
90% (90%) of resource data information requests will be responded to within five clear business days of receipt.
Permit Allocation and Management
Quantity
Process an estimated:
- 165 permit applications; and
- 220 permit change applications.
(2002/2003 measure - 220 permit and permit change applications.)
Monitor an estimated total of 440 (440) permits for compliance with conditions as follows:
- monitor all (100%) petroleum permits for compliance with conditions on work programme milestones;
- review and approve 250 (250) minerals mining permit work statements; and
- review 120 (120) minerals prospecting and exploration permit work programme commitments based on annual activity reports.
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.)
Timeliness
90% (90%) of new permit applications will be processed within an average time of six months of receipt.
90% (90%) of permit change applications will be processed within three months of receipt (excluding applications for extension of area).
90% (90%) of mining permit work statement reviews will be undertaken within 30 clear business days of receipt.
Crown Revenue Collection
Quantity
Amounts collected:
- royalties - $33.3 million ($35.1 million); and
- energy resource levies - $86.3 million ($100.7 million).
Quality
Undertake a minimum of 10 (3) compliance audits of energy resource levy or royalty payers within five months of receipt of annual royalty or levy and pursue any shortfalls.
Timeliness
95% (95%) of royalties will be collected within one month of due date.
90% (90%) of fees will be collected within two months of due date.
Costs: Vote Energy, Output Class D2
| | 2003/2004
Forecast | 2002/2003
Supple-
mentary
Estimates | 2002/2003
Estimated
Actual |
|---|
| | $000 | $000 | $000 |
| Revenue Crown | 2,184 | 2,133 | 2,133 |
| Third Party Revenue | 3,536 | 3,186 | 2,716 |
| Expenses | 5,626 | 5,225 | 5,098 |
| Surplus/(Deficit) | 94 | 94 | (249) |
Output Class D3 - 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.
Service Performance Objectives - Output Class Specific
Where appropriate, comparative figures for the previous year are shown in parentheses.
2003/2004 Performance Measures and Standards
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 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; and
- the key milestone dates required of the Energy Safety Service in the EnergySafe programme for legislative change will be met.
The EnergySafe project will translate the Government's May 1999 "in principle" decisions on the review of the safety regime for the electrical and gas industries, into the legislative changes needed to implement a new safety regime. The changes are designed to remove the inconsistencies between legislation, and provide consumers with choice and a greater comfort that safety is being maintained and enhanced.
Other Activity for 2003/2004
Quantity
It is planned to:
- publish 75 (75) electricity standards and four (4) gas standards under funding contracts with Standards New Zealand;
- publish two (2) electrical codes and one (1) gas code of practice;
- undertake 90 (90) audits and inspections of gas and electricity appliances, installations and networks and distribution systems; and
- conclude one (1) additional international agreement by 30 June 2004.
An estimated 80-100 (90) gas and electricity accidents and incidents are expected to be investigated.
Timeliness
90% (90%) of audit, inspection and accident investigation reports will be 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.24
Petroleum Monitoring
Quantity
It is planned to undertake 250 (250) petroleum monitoring tests.
Timeliness
The petroleum monitoring programme annual report will be published by 30 September 2003.
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.25
All (100%) prosecution and prohibition processes will meet legal and policy requirements.
Electrical Workers Licensing
Quantity
Expected numbers:
- action an estimated stimated1,000 electrical workers registrations; and
- issue an estimated 20,500 (20,500) practising licenses.
Conduct an estimated:
- 5,000 telephone competency audits of registered electrical workers who have not uplifted a practising licence; and
- 200 competency audits of electrical workers who hold a provisional licence and/or are supervised trainees.
(2002/2003 measure - 3,500 competency audits of electrical workers.)
Quality
All (100%) decisions by the Registrar that are referred to the Electrical Workers Registration Board will comply with the Electricity Act 1992 and Electricity Regulations 1997 and with published policies.
Timeliness
Licensing and Registrations
- 95% (95%) of correctly completed practice licensing applications will be processed within 10 clear business days of receipt;
- 95% (95%) of correctly completed registration applications (applying through the Electro Technology Industry Training Organisation or as New Zealand based trainees) will be processed within 10 clear business days of receipt; and
- 65% of correctly completed overseas applications for registration will be processed within 10 clear business days of receipt.
Complaints
- 95% (100%) of complaints against registered electrical workers will be 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% (80%) of checks completed within 60 working days of their 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);
- 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); and
- produce an annual report on electricity line company performance for the 2002/2003 year by 31 December 2003.
Quality
- all financial information disclosures will be accompanied by an audit certificate;
- all information disclosures will be accompanied by a declaration form completed by a Director of the company concerned;
- all information entered into the Ministry database will be subject to validation checks for accuracy and completeness; and
- all reports to the Minister will be reviewed internally for completeness and accuracy.
Costs: Vote Energy, Output Class D3
| | 2003/2004
Forecast | 2002/2003
Supple-
mentary
Estimates | 2002/2003
Estimated
Actual |
|---|
| | $000 | $000 | $000 |
| Revenue Crown | 895 | 895 | 891 |
| Third Party Revenue | 7,420 | 7,420 | 7,185 |
| Expenses | 8,226 | 8,226 | 8,222 |
| Surplus/(Deficit) | 89 | 89 | (146) |
Output Class D4 - 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.
Work undertaken in 2003/2004 will ensure that when required the Government will have access to the information necessary to meet its international obligations under the Kyoto Protocol, as set out in the requirements of the Climate Change Response Act 2002, and enable international trading in emissions units and sink credits when this commences.
2003/2004 Performance Measures and Standards
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:
- contributing to the development of international technical standards relating to the exchange of data between registry systems through participation in international negotiations and conferences; and
- development of business requirements for a New Zealand national unit register by 30 June 2004.
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.
Costs: Vote Energy, Output Class D4
| | 2003/2004
Forecast | 2002/2003
Supple-
mentary
Estimates | 2002/2003
Estimated
Actual |
|---|
| | $000 | $000 | $000 |
| Revenue Crown | 427 | - | - |
| Third Party Revenue | - | - | - |
| Expenses | 427 | - | - |
| Surplus/(Deficit) | - | - | - |
Output Class D5 - 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. Outputs in this output class include:
- 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;
- collecting and compiling 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;
- preparing 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;
- managing New Zealand's response to any international disruption to oil supplies; and
- managing New Zealand's energy international relations.
Service Performance Objectives - Output Class Specific
Where appropriate, comparative figures for the previous year are shown in parentheses.
2003/2004 Performance Measures and Standards
Energy and resource information services will be delivered as agreed with the Minister and detailed in the Ministry of Economic Development Output Plan.
Key Deliverables for 2003/2004
Quantity and Timeliness
- 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.
This will ensure that there is adequate information available to make appropriate interventions, should security risks be unacceptably high, or for businesses and consumers to have access to electricity at reasonable cost while effectively managing their security risks.
Quality
All material produced will be internally reviewed for completeness and accuracy prior to publication.
Costs: Vote Energy, Output Class D5
| | 2003/2004
Forecast | 2002/2003
Supple-
mentary
Estimates | 2002/2003
Estimated
Actual |
|---|
| | $000 | $000 | $000 |
| Revenue Crown | 1,306 | 876 | 877 |
| Third Party Revenue | 975 | 1,036 | 998 |
| Expenses | 2,272 | 1,903 | 1,866 |
| Surplus/(Deficit) | 9 | 9 | 9 |
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