Buying electricity

Learn about the All-of-Government electricity contract, through which schools can purchase electricity from one of five potential suppliers. Also find general advice on buying electricity.

Level of compliance Main audience Other

Recommended

  • Principals and Tumuaki
  • Staff responsible for buying on behalf of their school
  • Boards

AoG contracts are optional for schools to join. If not joining the AoG contract and entering into a commercial agreement with an electricity supplier instead, it is still recommended that schools consider the advice on this page.

Benefits of joining this AoG contract

Joining an All of Government contract is likely to save schools both time and money, while also reducing risk.

Learn more about All of Government contracts.

The AoG electricity contract offers the following benefits to schools.

  • Competitive prices for electricity, with other participating government agencies saving 5% on average, in comparison to pricing available outside of the AoG contract.
  • Prompt payment discounts if payment is made by the due date.
  • Fixed energy prices over the agreed term of the supply.
  • Fair and transparent contract terms.
  • Improved supplier performance, including supplier reliability, fault reporting and notification of planned outages.
  • Support and advice from both electricity suppliers and New Zealand Government Procurement.

How to join the AoG electricity contract

Step Action
1

Contact New Zealand Government Procurement (NZGP)

 

Email NZGP at utilities.coe@mbie.govt.nz.

 

After contacting NZGP, they will let you know when they expect that your school will be able to join the contract.

 

Your school will be added to the contract with a group of other government customers, in a batch referred to as a ‘tranche’.

 

It typically takes around 6-8 months from expressing interest in joining a tranche to commencing the new contract. Therefore, it is important that you start the process several months in advance of your current supply contract expiring.

 

Tranches are added to the contract only on specific dates, which differ every year.

 

2

Before you begin

 

If your school hasn’t signed up to an AoG contract before, you will need to complete a non-disclosure agreement (NDA) available on the New Zealand Government Procurement website(external link).



Learn more about NDAs.



You can contact school.buying@education.govt.nz to find out if your school has already completed an NDA.

 

3

Read about the contract and the memorandum of understanding (MoU)

 

Log in to the New Zealand Government Procurement website(external link) to access more information on the contract. You will need to be using your school-linked RealMe account, as you will gain access to commercially sensitive information.

 

Learn more about linking a RealMe account to a school.

 

Read the MoU for the electricity contract in the ‘Contract documents’ section on the New Zealand Government Procurement webpage(external link). The MoU sets out the obligations of schools participating in the contract.

 

Learn more about MoU.

 

4

Register for a tranche

 

To register to be included in a tranche, sign a Letter of Accession.

 

Request a Letter of Accession for the contract by emailing utilities.coe@mbie.govt.nz.

 

Learn more about LoAs.

 

Completing the LoA confirms your school agrees to the terms set out in the Memorandum of Understanding (MoU).

 

Your completed LoA must then be emailed to utilities.coe@mbie.govt.nz.

 

5

Provide electricity information


Email the below information to utilities.coe@mbie.govt.nz.

  • The number and type of meters that require electricity supply and the Installation Control Point (ICP) numbers for each meter (if not known, check invoices from your current supplier).
  • Confirmation of your current supplier and the expiry date of your contract.
  • Copies of your recent electricity invoices (preferably for 12 months).


New Zealand Government Procurement (NZGP) will provide this information to suppliers.


Until a pricing supplement is signed (Step 8), your school has not committed to any agreement with suppliers.

 

6

Wait for NZGP to complete a secondary procurement process


When NZGP has processed your completed LoA, they will send your school’s requirements to suppliers, alongside the requirements of the other participants in your tranche.


The electricity suppliers for the AoG contract are:

  • Contact Energy
  • Mercury Energy
  • Trustpower
  • Genesis Energy
  • Meridian Energy


NZGP will receive and evaluate each supplier’s offer with the help of an external specialist.


This secondary procurement process may take up to two months to complete.

 

7

Evaluate the offer recommended by NZGP


When the secondary procurement process is complete, NZGP will send your school a recommendation for a supplier’s offer and a full pricing report for your school to sign off on.

 

These documents will state the:

  • pricing offered by all suppliers
  • terms of all offers
  • expected charges and budget implications for your school for all offers
  • offer recommended by NZGP for your school, based on value for money.


Your school then has two weeks to choose to accept the recommended offer.

 

8

Accept an offer


Sign a pricing supplement with the supplier.

 

A supplement states the:

  • sites that will be supplied
  • service start date
  • duration
  • charges
  • any other terms.


When the supplier has also signed the supplement, your school will be able to transition to the new supplier upon your current contract’s expiry.

 

Advice for buying electricity outside of the AoG contract

Approach the market early

It is recommended that schools approach the market approximately six months before the expiry of a current contract.

Schools then have the freedom to evaluate the offers made by suppliers and even decline all of them, if it expected that the prices offered will be lower in one or two months’ time.

Approaching the market late can encourage any of the following:

  • Shortcuts to be taken when providing information to suppliers and evaluating offers, which can have costly consequences.
  • Agreement to a long-term contract at a time when electricity prices are irregularly high.
  • The temporary usage of expensive short-term pricing while a long-term purchase is finalised.
  • The rolling over of a current contract, which may not be the best available on the market.

Provide accurate data

Electricity suppliers make their offers based on the information that is provided to them.

When electricity suppliers receive incomplete, old, or inaccurate data, they are likely to make a higher priced offer, so that the costs of any risk are placed with the school.

Be sure to give suppliers:

  • the ICP numbers of all sites
  • a full set of monthly electricity consumption data (most recent 12 months)
  • a note about any potential upcoming increases or decreases in electricity use.

Run a competitive process

It is recommended that at least five suppliers are contacted and asked to make offers.

See the list of suppliers who also supply electricity under the AoG contract.

As markets change over time, suppliers that may have made not-preferred offers in the past might make the best offer at this time of asking.

See Running a competitive buying process.

Evaluate offers effectively

Suppliers can provide their offers to schools in differing formats. This can make it difficult to compare their offers.

It is always worth putting in the time to format the information received so that it is easier to compare. It is also important to double-check any calculations completed while doing this.

At the most basic level, it is crucial that total annual costs offered by all suppliers are compared.

Last reviewed: Has this been useful? Give us your feedback