Wholesale market arrangements for battery energy storage systems: Code amendment consultation

We are seeking feedback on a proposal to amend the Electricity Industry Participation Code to improve wholesale market operations for utility-scale battery energy storage systems (BESSs).

BESSs can play a critical role in maintaining security and resilience, especially as New Zealand transitions to a more variable power system. They can help balance intermittent generation from solar and wind, support efficient investment, and reduce electricity prices for all consumers. To unlock these benefits, regulatory settings governing BESSs must be fit for purpose.

What we are proposing

We are proposing a Code amendment, and associated software upgrades, to:

• require BESSs to be dispatchable when charging
• move to a single bid and offer form, and a single reserve offer form (but with separate sections for generation reserve and interruptible load) for BESSs
• allow full capacity trading for BESSs with state of charge constraints and one hour gate closure. State of charge constraints would ensure dispatched quantities remain feasible, allowing BESS owners to trade their full capacity
• as an interim arrangement, allow BESS owners to trade their expected capability and revise trade quantities after gate closure if expected capability changes.

Key changes from previous issues and options paper

This consultation is informed by submissions received during our Wholesale market arrangements for battery energy storage systems issues and options paper. At a high-level, our proposals remain largely the same with two exceptions:

• we are no longer proposing to change existing financial compensation rules for BESS
• we are proposing to accelerate work to investigate reducing gate closure period for BESS.

We welcome the opportunity to discuss this consultation with you:

• Webinar: Join our online session on Thursday 11 June 2026, 10.30am–12.00pm to learn more about the BESS consultations, explore the key issues and ask questions. Register for the webinar
• One-on-one briefings: We are also available to meet with you. To request a briefing, email OperationsConsult@ea.govt.nz with ‘BESS EOI’ in the subject line by 5pm, Tuesday 23 June.

We encourage interested parties to consider the following related consultation and discussion paper when providing feedback.

Common quality and wholesale market arrangements for BESSs and BESS-hybrid stations

We have presented issues and options in this paper related to:

• Part 8 common quality requirements for BESS-hybrid stations and idle BESSs
• Part 8 common quality requirements for voltage support obligations for transmission-connected generation, including potential to move the point of compliance to the network connection point
• Part 13 trading arrangements for BESS-hybrid stations

Based on feedback on these issues and options, we plan to consult on any Code amendments later in 2026.

View consultation and have your say

5-minute settlement period discussion paper

We have released a 5-minute settlement discussion paper on the costs and benefits of moving to a five-minute settlement period. We considered whether this would better align settlement with the capabilities of fast‑responding technologies such as BESSs. The Authority’s current view is that market conditions do not support a transition to five‑minute settlement at this stage.

This discussion paper is not a formal consultation, however we welcome feedback on it to OperationsConsult@ea.govt.nz by 5pm, 30 June 2026.