Insolvent Retailers
Overview
This work programme came about as a result of the Gas Governance (Insolvent Retailers) Regulations 2010. Those Regulations were created, using the urgent regulation-making provisions of the Gas Act (section 43P).
Consultation
Previously Consulted On
Gas Governance (Insolvent Retailers) Regulations 2010 - Statement of Proposal
As you are aware, the IRR were passed under urgency last November. The Gas Act 1993 requires that, after urgent regulations are made, those regulations must be assessed and consulted on, and a recommendation must go to the Minister on whether the regulations should be revoked, replaced, or amended.
The consultation paper is in two parts. The first part assesses the IR Regulations and concludes that they do not provide a set of transition arrangements that would be suitable in all cases of retailer insolvency. The draft recommendation in the paper is therefore to allow the IR Regulations to expire.
The second part of the consultation paper begins to address a request by Minister Brownlee to Gas Industry Co to provide advice on the "form and content of backstop regulations" to address retailer insolvency. The paper briefly canvasses the objectives and frameworks of insolvent retailer regulations in other jurisdictions. It seeks responses to a number of high-level questions, including whether retailer insolvency is an issue that warrants regulatory intervention and, if warranted, possible forms such intervention might take. Responses will be used to guide further work in this area.
Your responses are invited on both parts of the consultation paper. Submissions must be received no later than 5.00 PM on Friday, 15 April 2011. Please note that responses after this date will not be able to be considered.
Submissions received
Arrangements for Insolvent Retailers
On 18 October 2010 the E-Gas group of companies went into liquidation. At the request of the Minister of Energy and Resources, Gas Industry Co assisted the Ministry of Economic Development and Parliamentary Counsel Office to prepare the Gas Governance (Insolvent Retailers) Regulations 2010.
The recommendation to the Acting Minister of Energy and Resources is that the Regulations be revoked by the operation of regulation 19, and that Gas Industry Co commence work to consider whether a generic regulatory solution is required to address retailer insolvency, and if so, to develop the form of that solution.
Insolvent Retailers Regulations - Recommendation to the Minister