Monday, 25 Oct 2021

Stock Takes: Contact, Meridian cleared; Cavalier CEO resigns

The Electricity Authority said it had found that neither Meridian nor Contact had breached trading provisions following an “undesirable trading situation (UTS)” complaint made by group of power companies.

Haast Energy Trading, Ecotricity, Electric Kiwi, Flick Electric, Oji Fibre, Pulse Energy Alliance and Vocus claimed that a UTS involving the spilling of water from November 2019 through to January 2020.

The companies alleged that Meridian’s and Contact’s action had the effect raising spot power prices.

In today’s decision, authority said it had completed its investigation into Meridian and Contact’s alleged breaches of the high standard of trading conduct provisions of the Electricity Industry Participation Code over the period concerned.

“The investigation concluded there was no breach of the existing rules and on that basis the board has decided not to lay a complaint with the Rulings Panel,” the authority said.

The authority’s chief executive, James Stevenson-Wallace, said that, based on the information available, Meridian and Contact did not breach the high standard of trading conduct on the basis that the conduct during the period was sheltered by the “safe harbour” provisions.

The investigator concluded Meridian and Contact did not breach the high standard of trading conduct because available capacity was offered, offers were made and revised in a timely manner, and one of the set of conditions of the safe harbour rule was met.

“Specifically, both generators demonstrated consistent offers in periods where they were pivotal with offers in periods where they were not,” he said.

The trading conduct rules have been considered in several events since they were introduced in 2014, and their interpretation has evolved, the authority said.

It said a lack of clarity in how the rules were structured presented “interpretation issues” and challenges for how the standards are applied.

As a result, these rules have been under review and the Authority has consulted on proposed changes, it said.

The authority said it expected to make a final decision on the proposed new rules in June.

Cavalier CEO resigns

Cavalier said it had “regretfully accepted” the resignation of chief executive Paul Alston.

The carpet maker said Alston wouldcontinue in the role while a replacement is recruited.

Alston joined Cavalier as chief financial officer in 2012 and has served as chief executive officer since May 2015.

He oversaw the turnaround and restructure of the carpet business, as well as the development of its new, all-wool and natural fibres strategy.

Chair George Adams aid Alston had led Cavalier through an intensive period of change and restructuring.

“The company now has zero debt, a strong and experienced leadership team and the financial resources to execute our new strategy which positions Bremworth as a global leader in designing and creating desirable, high performing, safe and sustainable interior products,” he said in a statement.

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