These standards are determined using economic considerations, including taking into account the cost to consumers of losses of supply, while meeting technical and safety requirements.

The Code (clauses 12.55 to 12.62) contains principles for their development and what must be included in the standards. They include:

  • an economic (probabilistic) standard for the whole grid, and the associated assessment of the costs and benefits of investment for reliability
  • a 'safety net' minimum reliability standard of N-1 for contingencies on the core grid. N-1 means that the system is planned such that, with all transmission facilities in service, the system is in a secure state, and for any one credible contingency event, the system moves to a satisfactory state. However, if more than one contingency event was to occur, load may have to be shed to return to a satisfactory state.

When Transpower reasonably expects that the existing connection or interconnection assets are unlikely to meet the grid reliability standards at the relevant grid exit point over the next five years, it must enter a process for upgrade of assets or amendment to the transmission agreement or service levels in the interconnection rules.