The auditor-general says Transpower's efforts to bolster the security of the national electricity grid have paid off, but further tests are needed to tell if longer term risk management strategies will work.
Testifying before the Commerce Committee yesterday, the deputy head of the auditor-general's Performance Audit Group, Mike Scott, said the firm had come a long way since a damning 2011 report.
That investigation found that while Transpower managed its corporate risks well, it found poor practices when it came to managing the condition of grid assets.
As such the firm, which manages the backbone that transports power from plant to lines companies, could not identify where potential weaknesses were likely to occur, increasing the likelihood of power outages.
Since then Transpower has undertaken a $3.8 billion upgrade, based on a "security of supply design".
The grid design and Transpower's planning had now reduced the short-term risk of failure, Scott said.
Transpower had also changed the way it managed spare parts, keeping them in various parts of the country to speed up repair times in the event of a failure.
However the auditor-general was unable to assess whether Transpower's efforts to manage longer term risks were sufficient, with a recently installed technical risk tool only going live in July.
"The long-term strategy is where Transpower needs to do the most work, managing assets and the risk in terms of condition of those assets and where the risk is," Scott said.
The new platform would be based on international PAS 55 risk management standards, but further testing would be needed to assess its suitability. The result is likely to be available in early 2014.