Practice note. Clause 12.1 applies if the Distributor requires that the Retailer comply with prudential requirements. The prudential requirements must comply with clauses 12A.4
Practice note. It is not clear whether, if the Retailer went into receivership and the Retailer is a customer of the Bank, the Bank would be prepared to waive any right of set off. The Distributor is advised to check with the Bank if the Retailer uses the same bank. Paragraph (d) of clause 12.24 below requires the Retailer to inform the Distributor of the bank(s) the Retailer uses.
Practice note. In clause 26.6, $2,000,000 is a minimum value that may be increased (but should not be decreased) if the parties agree. Clause 26.6 is intended to provide a useful formula for calculating the liability cap by reference to the number of ICPs connected to the Network at which the Retailer supplied electricity on the day of the relevant event. However, the parties should amend this formula where its application would lead to an unreasonably low liability cap (e.g. if the relevant Retailer has a large market share in the electricity market, but trades with a low number of ICPs on the Network).
Practice note. The basis of this model conveyance agreement is as follows: The Distributor provides Distribution Services directly to its Connected Customers. The Retailer provides electricity to its Consumers. The Connected Customer and the Consumer at Connected Premises may be the same person or different persons. Either way, the Distributor and Retailer will co-operate to ensure that the respective services they provide to the Connected Customer and Consumer (as the case may be) are synchronised and Connected Customer/Consumer service requests and queries are referred to the relevant party as necessary. If the Distributor's business model is such that a Distributor’s Connected Customer and a Retailer’s Consumer at a premise will always be the same person, this model agreement can be amended to reflect that, by adding a clause to say that a Distributor's Connected Customer and a Retailer's Consumer are the same person in all cases. Alternatively, the agreement may be modified by collapsing the two definitions into one and making suitable consequential amendments. Both direct billing by the Distributor, and Retailer billing on behalf of the Distributor (including when it does so on an “agency basis”) are provided for in this agreement, at the Distributor’s option. The Retailer billing option will require further negotiation to establish the specific Services the Distributor seeks and the Retailer’s capability and fee to provide those Services. Each party has rights to connect, disconnect, and decommission ICPs in certain circumstances (e.g. to manage bad debts). Since the actions of one party may impact on the provision of services by the other party, this agreement requires that information will be provided whenever a party changes the connection status of an ICP. AGREEMENT
Practice note. This MUoSA assumes that no load management services are provided by a party other than the Distributor or the Retailer (i.e. a load aggregator). The Electricity Authority will continue to monitor the development of possible third party entry into the market for load management services.
Practice note. Clause 12A.4 of the Code provides that the value of acceptable security that the Distributor may require from the Retailer is the Distributor's reasonable estimate of the line function service charges that the Retailer will be required to pay to the Distributor in respect of any period of not more than 2 weeks. If, however, the Retailer elects to provide acceptable security in accordance with clause 12.1(b), the Distributor may require additional security, provided that the total value of all security required is no more than the Distributor's reasonable estimate of the line function service charges that the Retailer will be required to pay the Distributor in respect of any 2 month period. The Distributor must comply with clause 12A.5 of the Code if additional security is required. If additional security is or may be required, clauses 12.7 and 12.8 should be inserted:
Practice note. If load management services are provided by a party other than the Distributor or the Retailer (i.e. a load aggregator), the Distributor and the Retailer will need to enter into a separate agreement with the party.
Practice note. Parties to delete either the arbitration clauses or the court proceedings clause on entry into the agreement. Either:
Practice note. Load Control Equipment may be provided by either the Retailer or the Distributor and may be based on a variety of technologies, the most common legacy systems in New Zealand being based on ripple control and pilot wire technologies.
Practice note. If parties elect in schedule 1 that Service Guarantee amounts exclude GST, the words in square brackets in clause 31.1(g) should be deleted.
