Mercury commissioned this analysis to evaluate whether existing energy sector governance — particularly the Security and Reliability Council (SRC) — is effectively protecting New Zealand’s electricity supply security for consumers.
The SRC was established under the Electricity Industry Act 2010 to provide independent oversight and advice on system operator performance and broader reliability matters. However, the report finds the council is under‑resourced, lacks formal independence, and has been side-lined. Despite statutory intent, it has not acted as a meaningful check on the Electricity Authority or Transpower.
The Electricity Authority itself appears to have deprioritised reliability concerns. Its statutory mandate includes competition, reliability, and efficiency, but recent emphasis has shifted toward affordability and low‑emissions outcomes. Legal interpretations mean the Authority can prioritize one limb over others, and its public messaging now frames purpose more in environmental and prosperity terms -diminishing clarity around its reliability mandate.
The Authority reportedly ignored or diluted key recommendations: for example, Recommendation G2 from the Electricity Price Review (2019) that SRC should assess long-term technological and risk trends with adequate resourcing was not pursued. The Authority avoided commissioning SRC for key resilience work and instead delegated responsibility to Transpower, limiting independent system assessment.
In conclusion, the report strongly recommends establishing an independent, well‑resourced entity with authority over monitoring security, reliability, and resilience. This entity should conduct audits, oversee risk factors and provide credible independent advice separate from political or regulator alignment. Restoring SRC independence and capacity is seen as essential to ensuring long‑term security of supply for New Zealand consumers.
David Reeve and Kieran Murray authored this report. For more information, see their related report: Confluence of factors threatening electricity reliability.