Court Simon; Woods MeganSIMON COURT (ACT): Thank you Mr Chair. I just want to go back to a point that was made previously about the multiple trading arrangements and just looking at Schedule 2 which inserts new Part 6A the Separation of distribution from … generation and retailing". We do have a major problem in New Zealand in that at peak times there is not enough capacity on a cold still night in winter to deliver electricity to all of the communities that suddenly turn on their heat pump or come home and plug in their taxpayer-subsidised electric vehicle. One of the ways that this could be achieved which has been proposed by electricity distribution companies is that they would like to be able to install for example energy storage devices in place of where the current transformers are located on many street corners. But the problem that they have is that the Resource Management Act doesn't allow them to do that. Then we come to issues of microgrids. There are communities around New Zealand—and the member for Auckland Central Chlöe Swarbrick mentioned Waiheke where in fact communities want to generate electricity store that energy distribute it and have agreements between themselves in the same way as many people have agreements through the Uber app with many many drivers that doesn't require a central regulator say of taxis to work out what the relationship should be between the customer who wants an Uber and how they get their taxi.So I'm interested in the Minister's comments about how new Part 6A "Separation of distribution from … generation and retailing" will foster the development of microgrids in communities which currently find it hard to navigate through the regulation so that if they wanted to say set up a solar array or a wind power array or a little hydro dam in their subdivision that they could then store and distribute electricity to each other and sometimes in reverse depending on which way the wind is blowing and where the sun's shining. And Minister will the regulations allow under this bill and under these schedules for communities to come to their own arrangements about how they generate distribute store and exchange electricity in the absence of having to engage with a company or a regulator. Minister? CHAIRPERSON (Ian McKelvie): Simon Court.SIMON COURT (ACT): Thank you Mr Chair. So I just want to come along to this point under new Schedule 6A.3 "Corporate separation and arm's-length rules applying to distributors … generators and connected retailers". Now it says here that a connected generator has a capacity of more than 50 megawatts connected to any of their networks and a retailer is involved in retailing more than 75 gigawatt hours of electricity in a financial year to consumers. One of the problems that we've got at the moment with our energy market is that it's very difficult to understand what is the regulatory pathway if say I wanted to use the gas that I find on my land if I was a farmer in Taranaki and I wanted to put down a bore and collect that wonderful natural gas and supply it to my neighbour. The regulatory pathway sounds very complicated Minister and yet we have so many natural resources in New Zealand that we should be able to exploit for the benefit of our communities and to ensure that we do have a healthy economy at some point in the future.So I'm interested whether the Minister wants to seek the advice of officials. Firstly will new Part 6A and will this bill and the regulations and schedules that it's proposing allow for communities to generate their own electricity and distribute it freely amongst themselves?With respect to corporate separation and the arm's length rules will it be possible—say for example when I worked at a big landfill and we generated 30 40 50 megawatts of electricity from collecting landfill gas. Would it be possible for us to simply connect that electricity to the neighbours who were running their own industrial operation and supply the neighbours with electricity? Will the regulations still force us to go through a lines company and then have a supplier one of the big retailers buy the electricity off us and then sell it back to consumers or can we come to our own arrangements between willing sellers and willing buyers Minister? Thank you.Hon Dr MEGAN WOODS (Minister of Energy and Resources): Thank you Mr Chair. Just to address the specifics that the member has brought up in his contributions one is around new Part 6A and the provisions that are contained in there. This is about making good the Electricity Price Review recommendations around flexibility that is required there. These are existing provisions in the Act. Many of them that have been moved into the code and so I think that what we're seeing is this is about actually just shifting where we do have a number of those provisions around there in that respect.In terms of some of the other points that the member has raised: in terms of the multi-trader arrangements—which I think is a really important part of the scope of what our electricity system and our energy system will look like in the future—this is of course something that we are actively seeking. These are exactly the kinds of arrangements that through our network of legislation and regulation we are looking to enable because the future of energy in New Zealand is not only decarbonised but it is also decentralised and it is also digitised."