Buying electricity
Learn about the all-of-government electricity contract, through which your school can purchase electricity from one of five potential suppliers.
| Level of compliance | Main audience | Other |
|---|---|---|
|
Recommended
|
|
|
- Benefits of joining this contract
- How to join the contract
- Advice for buying electricity outside of the contract
- More information
Benefits of joining this contract
Joining an all-of-government contract is likely to save your school both time and money, while also reducing risk.
The all-of-government (AoG) electricity contract offers the following benefits to your school.
- Fixed energy costs over the term of the supply agreed between the selected supplier and agency.
- Consumption data (historical and real-time) to help reduce emissions from goods and services.
- Desktop and cloud-based applications that you can use to review usage and spend data.
- Fair and transparent contract.
- Improved supplier performance, including supplier reliability, fault reporting and notification of planned outages.
- Support and advice from both the electricity supplier and New Zealand Government Procurement
How to join the contract
- Contact New Zealand Government Procurement
- Complete a non-disclosure agreement
- Read about the contract and the memorandum of understanding
- Register for a tranche
- Define your electricity requirements
- NZGP will complete a secondary procurement process
- Evaluate the offer recommended by NZGP
- Accept an offer
1. Contact New Zealand Government Procurement
Email New Zealand Government Procurement: utilities.coe@mbie.govt.nz.
After you contact New Zealand Government Procurement (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'.
The process typically takes between 6-8 months from expressing interest in joining a tranche to commencing the new contract. As such, it is important that you start the process at least 6 months in advance of your current supply contract expiring.
Tranches are added to the contract only on specific dates, which differ every year.
2. Complete a non-disclosure agreement
What is a non-disclosure agreement?
If your school hasn’t signed up to an AoG contract before, you will need to complete a non-disclosure agreement (NDA).
Non-disclosure agreement form – NZGP(external link)
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
What is a memorandum of understanding?
Log in to the NZGP website to access more information on the contract. You will need to be using your school-linked RealMe account because you will gain access to commercially sensitive information.
Electricity – NZGP(external link)
Read the memorandum of understanding (MoU) for the electricity contract in the ‘contract documents’ section on the NZGP website. The MoU sets out the obligations of schools participating in the contract.
4. Register for a tranche
To register to be included in a tranche, complete a joining form.
The joining form confirms your school agrees to the terms set out in the MoU.
An online joining form for the electricity contract is available under ‘joining this contract’ (you will need to be logged in with a school-linked RealMe account).
Electricity – NZGP(external link)
- Your school may choose to submit a 'letter of accession' (printable PDF) instead of the online joining form.
- You can download a copy of the PDF from the 'joining the contract' section on the NZGP webpage.
- Once completed, email the form to utilities.coe@mbie.govt.nz.
Once the joining form is processed, you will receive a confirmation email.
5. Define your electricity requirements
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 the last 12 months).
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. NZGP will complete a secondary procurement process
When NZGP has processed your completed joining form, they will send your school's requirements to suppliers along with requirements of the other participants in your tranche.
The electricity suppliers for the AoG contract are:
- Simply Energy
- Mercury Energy
- Manawa Energy
- 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 2 months to complete. There is some flexibility in contract start dates so it is recommended that this is discussed with the Utilities team.
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 2 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
We recommend that you approach the market 6 months before the expiry of your school's current contract.
You then can evaluate the suppliers' offers and even decline all of them if it expected that the prices offered will be lower in 1 or 2 months’ time.
Approaching the market late can be risky:
- 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 you provide 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 your 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 5 suppliers are contacted and asked to make offers.
Here is the list of electricity suppliers under the AoG contract as a starting point:
- Simply Energy
- Mercury Energy
- Manawa Energy
- Genesis Energy
- Meridian Energy.
As markets change over time, suppliers that may have made not-preferred offers in the past might make the best offer at the time of asking.
Running a competitive buying process
Evaluate offers effectively
It is crucial that total annual costs offered by all suppliers are compared.
Suppliers can provide their offers to your school in different formats. This can make it difficult to compare these 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.
Last reviewed: Has this been useful? Give us your feedback