What is INTSA?
The Innovation and Non-Traditional Solutions Allowance (INTSA) is designed to support investment in innovative and non-traditional solutions within New Zealand’s electricity sector.
It is administered by the Commerce Commission as part of the Default Price-Quality Path 4 (DPP4) regulatory period, commencing on 1 April 2025 and running for five years.
INTSA aims to enhance electricity supply reliability, lower consumer energy costs, and encourage innovative solutions that improve the sector’s efficiency and sustainability.
Watch this video by the Commerce Commission explaining their role in regulating the electricity sector and the importance of investment in innovative and flexible energy solutions.
How Can INTSA Support Demand Flexibility Projects?
One of the key areas for investment through INTSA is demand-side flexibility (DSF), where consumers adjust their electricity consumption patterns to balance supply and demand.
This approach optimises grid efficiency, reduces peak load stress, and enhances overall system resilience.
INTSA funding can be leveraged by Electricity Distribution Businesses (EDBs) to implement demand flexibility projects, ensuring they remain agile and responsive to evolving energy needs.
Why Is Investment in Demand Flexibility Projects Important?
The Minister of Energy has expressed clear expectations that flexibility services should become an integral part of New Zealand’s energy sector.
Additionally, the recent liquidation of SolarZero, a key player in New Zealand’s solar/battery energy market, underscores the importance of ensuring that flexibility services are appropriately valued and rewarded.
Without sustainable market mechanisms to support the growth and reliability of flexibility resources, the sector risks limiting the scale and firmness of available demand-side solution.
This event serves as a reminder that the industry must re-evaluate and strengthen its approach to flexibility services and innovation to remain resilient.
Investing in demand flexibility projects offers several strategic benefits:
- Lowering Long-Term Energy Costs: By optimising electricity consumption, DSF reduces peak demand, potentially lowering wholesale electricity prices and transmission costs.
- Managing Infrastructure Risks: With long lead times for major infrastructure projects, flexibility solutions provide an alternative to costly and time-consuming network expansions.
- Regulatory Compliance: Increased regulatory emphasis on flexibility services means EDBs must proactively invest in solutions that align with regulatory expectations and emerging industry standards.
- Future-Proofing the Energy Sector: As electrification and renewable energy integration expand, demand flexibility ensures that the grid remains stable and efficient.
Who Can EDBs Partner With to Develop Demand Flexibility Projects?
To maximise the impact of INTSA-funded initiatives, EDBs should collaborate with experienced solution providers.
Companies like Cortexo offer expertise in making electricity consumption patterns visible and managing flexible electricity supply effectively.
What Are the Benefits of Flexibility Solutions – Why Bother?
Investing in demand flexibility solutions through INTSA offers tangible benefits for both EDBs and electricity consumers:
- Enhanced Grid Resilience: More efficient electricity distribution reduces the risk of outages and system failures.
- Optimised Investment Costs: EDBs can defer expensive infrastructure upgrades by leveraging demand-side flexibility.
- Smoother Regulatory Pathway: Proactively adopting flexibility services aligns with government policy expectations, reducing regulatory risks.
- Consumer Benefits: Lower energy costs and more stable electricity pricing contribute to a better customer experience.
How to Apply for INTSA and What to Expect
EDBs applying for INTSA should prepare a well-documented proposal outlining their innovation project. The application process includes:
- Reviewing Eligibility Criteria: Ensure the project aligns with INTSA objectives and regulatory guidelines.
- Engaging with Key Stakeholders: Collaborate with solution providers like Cortexo to strengthen the proposal.
- Submitting the Application: Follow the Commerce Commission’s outlined process and submit your application from April 2025.
- Awaiting Approval and Funding Allocation: Successful projects will receive funding to commence implementation.
As the energy landscape evolves, EDBs are exploring new ways to enhance demand-side flexibility and improve network resilience.
By leveraging data-driven insights and innovative technologies, there are significant opportunities to optimise grid performance and adapt to changing market conditions.
- Cortexo has been working closely with industry partners to explore practical solutions, including:
- Real-time monitoring and management of electricity demand to improve grid stability.
- Using predictive analytics to optimise network performance and reduce constraints.
- Integrating emerging technologies to complement existing infrastructure.
- Navigating evolving regulatory requirements to ensure compliance and future readiness.
We’re always keen to collaborate with EDBs looking to refine their approach to demand flexibility. If you’d like to discuss potential strategies or share insights, feel free to reach out—we’d love to hear your perspective.
Final Thoughts
With the Minister of Energy’s clear stance on the importance of flexibility services, EDBs have a unique opportunity to leverage INTSA funding to future-proof their operations.
The recent challenges in the industry, including SolarZero’s liquidation, reinforce the need for resilient and innovative demand flexibility solutions.
By investing in demand flexibility projects, businesses can manage risk, comply with regulatory changes, and deliver tangible benefits to consumers.
For further details on partnering with Cortexo for demand flexibility projects, reach out to Terry Paddy at terry.paddy@cortexo.com or 021 359 868.
References
- Commerce Commission (2024). INTSA Final Decision Paper, Nov 2024.
- NZ Government (2024). Statement of Government Policy to the Electricity Authority
- under section 17 of the Electricity Industry Act 2010, Oct 2024.
- Cortexo DDP4 PDF. Briefing on DPP4.
- Commerce Commission (2025). 2025 Reset of the Electricity Default Price-Quality Path.
