Critical Contingency Management

The Gas Governance (Critical Contingency Management) Regulations 2008 (the Regulations) were amended in 2013 following a recommendation to the Minister of Energy and Resources from Gas Industry Co. One of the amendments was to change the arrangements relating to Regional Critical Contingencies.

In the design of the original regulations it was considered that it would be obvious to industry participants whether a critical contingency was regional or not. As a result, the CCM Regulations did not specify who would determine that status or when. Subsequent feedback showed that Transmission System Owners (TSOs) wanted the status to be clarified as soon as possible during a critical contingency and that view was shared by a number of shippers. As a result, the 2013 amendments included the following requirements:

• the industry body (Gas Industry Co) must prepare and publish guidelines to assist the Critical Contingency Operator (CCO) to determine whether a critical contingency is a regional critical contingency;
• as soon as possible after determining a critical contingency, the CCO must determine whether it is a regional critical contingency and publish a notice of that determination; and
• during a critical contingency, the CCO must also consider whether any event has occurred that would cause it to revise the CCO's determination and, if so, publish a notice to that effect.

Related Information

Related documents

• Regional vs Non-regional Guidelines

  282 KB Adobe Acrobat PDF file

The Contingency Management Regulations provide for Gas Industry Co to determine and publish certain matters regarding the operation of the regulations. Notice of these determinations are available in Related Documents below.

Frequency of Consumer Notifications of the Contingency Management Regulations

Retailers are required to notify their non-domestic consumers of the existence of the Contingency Management Regulations (and their obligations under the regulations) at intervals specified by Gas Industry Co, which must be between 1-3 years (r44(2)(ii)).

Following consultation, Gas Industry Co has decided that retailers should notify their non-domestic consumers of the regulations (specifically the matters in r44(1)) on a two-yearly basis.

Gas Industry Co also encourages retailers to notify ‘newly gained’ customers of the matters in r44(1) of the CCM regulations at the time of acquisition.

The summarised Consultation Paper, submissions received, and Analysis of Submissions are all contained within the Final Decision Paper which can be viewed below in Related Documents.

Matariki

Gas Industry Co has determined that the new public holiday acknowledging Matariki is a non-business day under gas governance rules and regulations.

The Notice of Determination of Non-Business Day by the Industry Body (Gas Industry Co) under Gas Governance Rules and Regulations can be read below.

It provides for this additional non-business day until the rules and regulations are amended to include an explicit reference to Matariki alongside New Zealand’s other statutory holidays.

Queen Elizabeth II Memorial Day

Following the passing of the Queen Elizabeth II Memorial Day Bill on 20 September 2022, Gas Industry Co determines Queen Elizabeth II Memorial Day, Monday 26 September 2022, to be a non-business day for the purpose of the Arrangements.

The Notice of Determination of Non-Business Day by the Industry Body (Gas Industry Co) under Gas Governance Rules and Regulations can be read below.

Related documents

• Critical Contingency Management Determinations v1.0 - December 2008

  77 KB Adobe Acrobat PDF file

• Determination regarding the definition of 'publish' under regulation 5 - February 2014

  37 KB Adobe Acrobat PDF file

• Final Decision Paper - Frequency of Consumer Notifications under the CCM Regulations - May 2016

  297 KB Adobe Acrobat PDF file

• Notice of Determination of Non-Business Day by the Industry Body (Gas Industry Co) under Gas Governance Rules and Regulations

  280 KB Adobe Acrobat PDF file

• Queen Elizabeth II Memorial Day Determination

  100 KB Adobe Acrobat PDF file

The critical contingency market fees are monthly fees that cover the costs of the Critical Contingency Management (CCM) arrangements. 

These costs are:

• payable to the Critical Contingency Operator (CCO)
• payable to any person we appoint to carry out any obligations under the CCM Regulations
• associated with critical contingency management and its obligations under the CCM Regulations.

Every person who purchases gas directly from a gas producer during a month is liable to pay the critical contingency market fees for that month.

We estimate the costs before each financial year, collects market fees in monthly installments throughout the year, and then perform an end-of-year wash up once the actual costs are known.

Ongoing costs for FY2025

(1 July 2024 to 30 June 2025)

Ongoing costs for FY2024

(1 July 2023 to 30 June 2024)

Previous years (2019 - 2023)

Previous years (2018 - 2010)

Under the CCM Regulations, gas consumers who satisfy certain criteria may qualify for a contingency designation.

This designation gives the consumer a degree of priority access to gas in a critical contingency, subject to availability and the directions of the Critical Contingency Operator (CCO).

Designation categories

The four designation categories are critical care, essential services, critical processing and electricity supply.

Critical care, for consumer sites that provide:

• hospital care (within the meaning of the Health and Disability Services (Safety) Act 2001)
• residential care, or support, of people with disabilities or people who are frail (whether because of their age or for some other reason) (please see guidance note below)
• primary health care
• dispensing medicines (within the meaning of the Medicines Act 1981)
• operating a prison (within the meaning of the Corrections Act 2004)
• essential support services for any of the above, for example, laundry services, cleaning or catering.

Essential services, for consumer sites that provide:

• mortuary services
• cremation of human remains
• treatment of biohazards to make them safe for disposal
• processing and supply of municipal drinking water
• treatment and processing of municipal sewage
• police, fire, and other emergency services.

Critical processing, for an installation where the following process is performed:

• A commercial or industrial process that fits the following criteria:
  • the process is underway and
  • the process can be shut down in less than 18 hours and
  • an immediate shutdown would require
    • disposal of dangerous or toxic chemicals or
    • extensive operations before the plant could resume operation
• A process that requires gas for a defined period to:
  • avoid serious damage to plant or
  • mitigate serious environmental damage or
  • prevent inhumane or cruel treatment of animals already at an abattoir.

Electricity supply:

To allow an electricity generating unit to start up and switch to an alternative fuel or to provide ancillary support to the electricity system.

How to apply

Gas consumers who meet the relevant criteria above can apply to us for designations using the following specific forms:

Critical Care Designation Application form

Essential Services Designation Application

Critical Processing Designation Application 

If you need help with the application forms email [email protected]

If you wish to apply for an Electricity Supply designation, email us at [email protected]

Use this form when reapplying for an already granted designation of any type:

Designation Reapplication

Guidance for completing applications

We have produced two guidance notes for those wishing to apply for Contingency Designations.

The guidance note on the meaning of 'completely independent' and 'independent' when appointing a technical expert relates to those applying for a Critical Processing Designation, for which a technical expert must be appointed to help assess the application. Other applications may have a technical expert appointed if we think it is necessary.

The guidance note on the meaning of 'residential care' relates to Critical Care Designation applications.

Active designations

Under Regulation 46O of the Gas Governance (Critical Contingency Management) Regulations we are obliged to publish a list of the ICPs that have designations. 

The list must include:

• the name and ICP identifier of the designated consumer installation
• the type of designation
• the date on which the designation was approved
• the date on which the designation will expire unless a further approval is given.

The list below includes all consumers that have had designations approved by us and that are still effective.

Designations expire two years after being approved and, if not renewed, will be removed from this list and lose the measure of priority access to gas in a critical contingency.

Related documents

• Guidance on the meaning of 'residential care'

  52 KB Adobe Acrobat PDF file

• Guidance on the meaning of 'completely independent' and 'independent' when appointing a technical expert

  61 KB Adobe Acrobat PDF file

• Active Designations 1 October 2024

  40 KB Excel spreadsheet

This section contains information for consumers regarding Critical Contingency Events

Related documents

• Critical Contingency Management FAQs

  40 KB Adobe Acrobat PDF file

• Consumer Information Regarding Critical Contingencies

  133 KB Adobe Acrobat PDF file

Find the Compliance Registration form here

Critical contingency FAQs

What is a critical contingency?

A critical contingency generally occurs when gas supply is disrupted to all or part of the natural gas transmission system. Such a disruption can be caused by an outage in a gas production station that prevents gas from being injected into the transmission system or a fault (for example a leak or breakage) in a transmission pipeline that prevents gas from being delivered into or from the pipeline.

The pressure in the transmission system needs to be kept within a specific range, and a mismatch between gas demand and gas supply can cause gas pressures to drop. If the gas pressure drops to a level that jeopardises the safe delivery of gas, this in turn triggers a critical contingency to be declared under the Gas Governance (Critical Contingency Management) Regulations 2008 (the Regulations). The Regulations provide for specific gas pressure threshold limits to be set by the transmission system owner.

What happens during a critical contingency?

The Critical Contingency Operator (CCO) has the responsibility under the Regulations for declaring and managing critical contingency situations. Once a critical contingency has been declared by the CCO, the objective is to stabilise pressures and gas supply on the affected parts of the transmission system. Stabilising pressure is important, because if gas pressure drops too low – if the pipeline is effectively sucked dry of gas – then restoring full gas supply to the affected downstream networks can take a very long time (possibly months). 

The main tool that the CCO has in managing pipeline pressure is the ability to require industrial and commercial gas users to stop using gas on the affected parts of the transmission pipeline. The CCO’s directions are relayed to retailers, who in turn instruct their customers to cease their gas usage as soon as possible.

The CCO manages pipeline pressure so that, when the fault causing the critical contingency is repaired, the supply of gas can be restored as quickly as possible.

Read more about the Critical Contingency Operator

What are the Gas Governance (Critical Contingency Management) Regulations 2008?

The Gas Governance (Critical Contingency Management) Regulations are intended to ensure that any gas outages are managed effectively. Some of the ways the regulations do this is by providing for:

• the appointment of a critical contingency operator
• the development of critical contingency management plans
• processes for managing a critical contingency.

Compliance process frequently asked questions

Here are answers to some common questions about critical contingency events and gas user obligations.

What are the Gas Governance (Compliance) Regulations 2008?

The Gas Governance (Compliance) Regulations 2008 provide for the monitoring and enforcement of gas governance rules including the Gas Governance (Critical Contingency Management) Regulations 2008. 

Read more about the Gas Governance (Compliance) Regulations

What is a breach of the regulations?

A breach may arise where there appears to have been non-compliance with any provision of the Gas Governance (Critical Contingency Management) Regulations 2008. These regulations govern the management of serious pressure events or outages on the gas transmission system. An example of a potential breach is failure to stop using gas when directed.

Read more about the gas regulations

Am I allowed to allege a breach?

Any person who believes, on reasonable grounds that a participant has breached the rules; and that person is affected by that alleged breach, may notify that alleged breach.

You can allege a breach by completing the notice of breach template:

Notice of Breach Template

and sending it to [email protected] .

In the event of a large and sustained outage, how can I register to receive breach notices?

Complete the form on the following page:

Compliance Registration Form

I registered to receive breach notices – what happens when I receive one?

If you register to receive breach notices, the Market Administrator will ensure you receive any notifications of the breaches relating to any other future gas outages. (See below for more information about the Market Administrator).

The information the Market Administrator sends you will enable you to consider whether the alleged breach has impacted your organisation, and therefore whether you consider that you have been affected by the alleged breach. If you consider that your organisation has been affected, then you may wish to join the breach by sending a return email to the Market Administrator.

Who is entitled to become a party to a breach?

All participants who consider that they are affected by the alleged breach may join as a party to the breach notice. Participants, in this context, include consumers (other than residential consumers). 

What happens if I join as a party to an alleged breach?

By joining as a party to an alleged breach:

• you will be kept informed at key stages of the breach process (for example when the materiality of the breach is determined you will be sent an email)
• you may be asked to provide information to allow the breach to be assessed and
• you may participate in any settlement proceedings or hearings.

Joining as a party to a breach notice is not an application for compensation. It is possible that a participant who is found to have breached the regulations may be required to pay a fine or some form of compensation, but joining a breach is no guarantee of entitlement to compensation.

What are the roles of the Market Administrator, Investigator, and Rulings Panel?

The Market Administrator, Investigator, and Rulings Panel are appointed under the Gas Governance (Compliance) Regulations 2008 to undertake a range of functions in relation to alleged breaches.

• The Market Administrator
  • receives breach allegations
  • refers material allegations to the Investigator and
  • attempts to settle non-material allegations.
  • The Market Administrator function is currently performed by Gas Industry Co.
• The Investigator
  • is independent from Gas Industry Co
  • has a range of powers to investigate and report on breach allegations and
  • can effect settlements, which must be referred to the Rulings Panel for approval or rejection.
• The Rulings Panel is an independent body appointed by the Minister for Energy.
  • The current Rulings Panel is a retired High Court Judge. 
  • In a quasi-judicial process, the Rulings Panel has jurisdiction to approve or reject settlements and to determine breach allegations and impose sanctions.

How long does the compliance process take?

The Market Administrator must make determinations of materiality expeditiously. If a breach is found not material by the Market Administrator, then the compliance process is complete.

If a breach is found material and referred to the Investigator, the Investigator has 30 business days (or longer by agreement) to reach a settlement.

If the Investigator cannot reach a settlement, then the breach is referred to the Rulings Panel. The Rulings Panel must use reasonable endeavours to make its final decision on a breach within 40 business days of the date by which it has received all written and oral submissions on that matter.

Why are residential consumers not invited to receive notification of breaches?

The compliance process allows gas users who believe they are affected by an alleged breach to join the process. Residential gas users are not covered by the Regulations and were not subject to curtailment notices.

What was the Maui gas outage?

The large Maui gas transmission pipeline, which is the main pipeline transporting gas from the fields in Taranaki to the upper North Island, was shut down on 25 October 2011 following a reported gas escape in the White Cliffs area of North Taranaki. A pipe seam weld was found to have a 120mm long split that required a significant repair, including the isolation and depressurisation of a 24-kilometre section of the pipeline and the removal and replacement of the damaged section of pipe.  Normal pipeline operations resumed on 30 October. The pipeline operator then conducted a thorough investigation into the circumstances of the pipeline failure.

A Critical Contingency was declared by the Critical Contingency Operator (CCO) at 10:50 on Tuesday 23 May 2017. 

What caused the event

The cause of the event was low linepack due to downstream delivery points taking significantly more gas than was being injected into the pipeline, which was exacerbated during a planned outage of the Pohokura Production Station.  During the period of this outage, the imbalance between supply and demand caused pipeline linepack and pressures to fall to the point where the critical contingency threshold of 3 hours to 37.5 barg at the Kapuni Gas Treatment Plant was breached.

Termination of event

The Critical Contingency was terminated at 18:15 the same day, after Pohokura returned to expected flows and the CCO considered that the supply of gas into the system was sufficient to meet expected demand. 

More information

More information on the event can be found on the CCO website:

Historical events (CCO website)

Performance Report

The CCO is required to produce a performance report that assesses the effectiveness of the critical contingency arrangements and, where applicable, identifies any improvements. On 30 June, a draft report was released for public comment, as well as a feedback form for submissions. The draft report can be found below. The final performance report can be found on the CCO website here 

Historical events (CCO website)

Resolving contingency imbalances

Under regulations 67 to 72, we are required to engage an independent industry expert to determine a critical contingency price to be applied to contingency imbalances sustained by interconnected parties and shippers during a critical contingency event. 

We engaged Tim Denne of Covec for this work, and his draft report, workshop slides and final critical contingency price report are available below.

Under regulation 77, we are also required to publish the contingency imbalances incurred during an event, and a table setting out this information is available below.

Related documents

• Draft Critical Contingency Price Report

  231 KB Adobe Acrobat PDF file

• Draft Performance Report

  1.4 MB Adobe Acrobat PDF file

• Critical Contingency Price Workshop Slides

  237 KB PowerPoint presentation

• Final Critical Contingency Price Report

  725 KB Adobe Acrobat PDF file

• Contingency Imbalance Volumes and Values

  81 KB Adobe Acrobat PDF file

At 6:30pm on 24 May 2016 the Critical Contingency Operator (CCO) declared a Critical Contingency. The underlying causes of the Critical Contingency were an unplanned trip of PPS at 4:20pm combined with the large gas demand on the day and depleting linepack. At 6:05pm, once the Critical Contingency threshold of 3 hours to 37.5 barg at the Kapuni Gas Treatment Plant was breached, the conditions for determining a Critical Contingency had been met. The CCO was required to determine and declare a Critical Contingency.

The Incident Report and Performance Report can be found on the CCO website:

Historical events (CCO website) 

Critical Contingency Price

Under regulations 67 to 72, we are required to engage an industry expert to determine a Critical Contingency price that will be applied to contingency imbalances sustained by interconnected parties and shippers during a Critical Contingency event. We engaged Tim Denne of Covec as the independent expert for this work.  His final Critical Contingency price report is available below.

Performance Report

Pursuant to regulation 65 of the Gas Governance (Critical Contingency Management) Regulations 2008, the CCO issued a draft Performance Report which can be found below along with the submission received.

Related documents

• Determination of Critical Contingency Price for 24 May 2016

  667 KB Adobe Acrobat PDF file

• Draft Critical Contingency Performance Report - 13 July 2016

  1.9 MB Adobe Acrobat PDF file

• Submission on Draft Performance Report - Greymouth Gas NZ Ltd

  552 KB Adobe Acrobat PDF file

What happened

Maui linepack on 14 and 15 April 2015 fell to levels that caused the Critical Contingency Operator (CCO) to issue a ‘Notification of Potential Critical Contingency’.

Report into event

We were concerned the situation was triggered by market operations behaviour rather than a physical supply problem.  We published a report in response to broad stakeholder interest in the event and limited public visibility of data surrounding it. 

The report, Potential Critical Contingency on 15 April 2015 – Analysis of Data’, can be found under Related documents below.

What the report found

In summary, the report concluded the linepack fall was caused mainly by a steep decline in Running Operational Imbalance (ROI) at transmission pipeline welded points, and that this was attributable principally to shippers on Vector’s North and South-Kapuni-Frankley Road (SKF) pipelines drawing more gas from the Maui pipeline than they had contracted for.

The event highlighted the ineffectiveness of the current Imbalance Limit Overrun Notice (ILON) process. The report noted that the introduction of daily cash-outs under the Maui pipeline market-based balancing regime that took effect from 1 October 2015 would prevent such imbalance accumulations at welded points and incentivise all pipeline users to improve primary balancing.

To help our analysis, we formally requested gas transaction information from relevant participants under the Information Gathering Protocol. This was not wholly effective, and the investigation was hindered because two retailers declined to provide the data requested.

Consequently, we decided to review the information gathering arrangements, in particular the role of the Protocol. 

Related documents

• Potential Critical Contingency on 15th April 2015 - Analysis of Data

  1.1 MB Adobe Acrobat PDF file

A Critical Contingency incident on the Gas Transmission System caused by an unplanned outage at the Pohokura Poduction station was declared at 12.48pm on Saturday 3 March 2012, and terminated at 11.39pm on the same day. The event resulted in a requirement for reduced consumption by large gas users. The Critical Contingency Operator (CCO) issued an Incident Report and Performance Report. Documents and other information relating to this event are available on the CCO website here. 

Under regulations 67 to 72, Gas Industry Co is required to engage an industry expert to determine a Critical Contingency price that will be applied to contingency imbalances sustained by interconnected parties and shippers during the event. Tim Denne of Covec was engaged for this work and his final price report is available below.

Related documents

• Final Price Report - April 2012

  582 KB Adobe Acrobat PDF file

A Critical Contingency incident on the Gas Transmission System caused by a gas escape from the Maui pipeline was declared at 1.25am on 25 October 2011, and terminated at midday on 30 October 2011. Documents and communications relating to this event are available below.

What caused the event?

The large Maui gas transmission pipeline, which is the main pipeline transporting gas from the fields in Taranaki to the upper North Island, was shut down on 25 October 2011 following a reported gas escape in the White Cliffs area of North Taranaki.

A pipe seam weld was found to have a 120mm-long split that required a significant repair, including the isolation and depressurisation of a 24-kilometre section of the pipeline and the removal and replacement of the damaged section of pipe. 

Normal pipeline operations resumed on 30 October. The pipeline operator then conducted a thorough investigation into the circumstances of the pipeline failure.

Review of Gas Critical Contingency Management

Gas Industry Co engaged Concept Consulting Group to review the effectiveness of the Critical Contingency Management processes and governance arrangements during the Maui outage. 

Post Maui Pipeline Outage Review - Update 7 May 2012

The Outage Review captured lessons learned from the five-day Maui event.

See Related documents below.

Related documents

• Post Maui Pipeline Outage Review update (GIC) - 7 May 2012

  49 KB Adobe Acrobat PDF file

• Incident Report (CCO) - 4 November 2011

  105 KB Adobe Acrobat PDF file

• Performance Report Feedback Form (CC)

  198 KB Adobe Acrobat PDF file

• Performance Report (Vector) - 21 December 2011

  573 KB Adobe Acrobat PDF file

• Gas Industry Co Media Release (Gas Curtailment ordered following gas pipeline leak) - 25 October 2011

  201 KB Adobe Acrobat PDF file

• Vector Media Advisory: Chain of Events - 26 October 2011

  92 KB Adobe Acrobat PDF file

• Vector Media Advisory: 1.00pm Update - 26 October 2011

  119 KB Adobe Acrobat PDF file

• Vector Media Advisory: 7.30pm Update - 26 October 2011

  81 KB Adobe Acrobat PDF file

• Vector Media Advisory: 1.00pm Update - 27 October 2011

  79 KB Adobe Acrobat PDF file

• Vector Media Advisory: 9.30am Update - 28 October 2011

  78 KB Adobe Acrobat PDF file

• Vector Media Advisory: 5.00pm Update - 28 October 2011

  65 KB Adobe Acrobat PDF file

• Vector Media Advisory: 10.00am Update - 29 October 2011

  78 KB Adobe Acrobat PDF file

• Vector Media Advisory: 2.00pm Update - 29 October 2011

  78 KB Adobe Acrobat PDF file

• Vector Media Advisory: 7.00am Update - 30 October 2011

  79 KB Adobe Acrobat PDF file

• Gas Industry Co Media Release: Maui Pipeline Outage Review - 3 November 2011

  218 KB Adobe Acrobat PDF file

• CCM Review Report (Concept Consulting) - June 2012

  2.2 MB Adobe Acrobat PDF file

A Critical Contingency was declared at 19:36 on 13 July 2010 and was terminated at 22:34 on 13 July 2010. Under the Gas Governance (Critical Contingency Management) Regulations 2008, a number of reports have been published in respect of this event:

• Critical Contingency Incident Report, prepared by the Critical Contingency Operator under regulation 64. This report outlines the events that occurred that day and the actions taken by the Critical Contingency Operator and the Transmission System Owner.
• Critical Contingency Operator Performance Report, prepared under regulation 65. The purpose of this report is to assess the effectiveness of the Critical Contingency arrangements during the event and identify areas where those arrangements could be improved.
• Under regulations 67 to 72, Gas Industry Co is required to engage an industry expert to determine a Critical Contingency price that will be applied to contingency imbalances sustained by interconnected parties and shippers on a Critical Contingency day. Dr John Small of Covec has been engaged for this work.

Related documents

• Critical Contingency Incident Report - July 2010

  83 KB Adobe Acrobat PDF file

• Critical Contingency Operator Performance Report - August 2010

  77 KB Adobe Acrobat PDF file

• Draft price report - August 2010

  523 KB Adobe Acrobat PDF file

• Final Price Report - September 2010

  535 KB Adobe Acrobat PDF file

• Presentation Slides - August 2010

  327 KB Adobe Acrobat PDF file

Related Information

Related Information

On 21 July 2021, Gas Industry Co recommended that the Minister of Energy and Resources make new gas governance regulations to replace regulations 82A and 82B of the Gas Governance (Critical Contingency Management) Regulations 2008 (CCM Regulations) that will be revoked by the Gas (Information Disclosure and Penalties) Amendment Act.

The new regulations would enable the High Court to impose civil pecuniary penalties of up to $200,000 on consumers who are not industry participants (other than domestic consumers) for specific breaches of the CCM Regulations.

The recommendation follows Gas Industry Co’s issue of a Statement of Proposal and consultation with industry participants on a broader package of reforms to the CCM Regulations. This proposal is being progressed ahead of other proposed changes to align with the amendments to the Gas Act and avoid any possible regulatory gap.

We anticipate a further recommendation on proposed amendments to the CCM Regulations relating to other aspects of our consultation following the completion of our consultation and assessment process on those proposed amendments.

The recommendation to the Minister can be found below. Gas Industry Company’s consultation on its Statement of Proposal for amending the CCM Regulations can be found here.

Related documents

• Recommendation to Minister Amendments to CCM Regulations Penalties

  313 KB Adobe Acrobat PDF file