Contact Energy Using North Island’s Power Supply


Image result for ohaaki power station

Low Water Inflow into Clutha River

Compared to the last 85 years of record keeping, the lowest average inflows into the Clutha River were recently seen this past March, April and May. Because of the continued shortage of water into Clutha River's hydro-electric dams, Contact Energy has had to come up with a solution to continue to meet customers’ energy demands.

North Island Gas Plants to the Rescue!

The solution to the water shortage was to turn to Contact Energy’s North Island thermal plants to work harder to fill the energy void. More energy to the North Island (compared to the South Island) is being supplied by the Cook Strait cable.

Thermal Energy Needed when Weather Does Not Cooperate

Although the New Zealand electricity market strives to be as renewable as possible, sometimes it is not possible to meet energy demands using only water and wind as resources. When help is needed, the thermal energy gas stations can help fill the energy gap, which is what is happening currently.

More Rain Would Stop the Lake Levels from Decreasing Any Further

The recent weather cold fronts from the south have been bringing snow instead of rain. This, in turn, has been causing dramatic increases in electricity demand. Overall, however, this winter is warmer and dryer than previous years, so more rain would help increase the water levels and help the power supply issue.

If hydro lake levels continue to drop, more pressure would be applied to alternative power sources throughout the country, which could lead to environmental impacts.

Low Water Levels Resulted in Greater Spot Power Prices

Because hydro-generated energy makes up about 60% of New Zealand’s electricity, the recent low levels in the hydro lakes have meant wholesale prices continue to increase. Customers who are on wholesale pricing agreements with retailers are noticing the increase on their energy bills. Although spot tariffs can offer long-term savings, customers who choose this must be willing to weather periods of higher than average prices, such as what we are currently facing. Spot tariff customers should keep an eye out for price spikes and get into the habit of shifting some of their energy use to off-peak times.

To eliminate any risk for future price spikes, customers should consider switching to a traditional fixed rate or smooth-pay plan.

Let Switchme Save YOU Money!

Has your electricity rate increased sharply, due to the low lake levels? If so, let Switchme help you compare power prices to see if something more reasonable is available! Contact us today for more details and to use our free power price comparison calculator.

Spot Prices Rise as Lake Levels Fall


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With the recent drop in hydro lake levels across the South Island, wholesale (spot) electricity customers have noticed electricity rates increasing since May. Those who are on traditional fixed rate electricity tariffs will most likely not notice any increases in the near future; however, for those who are on spot tariffs, increases are predicted to continue throughout the winter.

Critical Lake Levels are Not Anticipated

60 percent of New Zealand’s electricity is made up of hydro-generated energy. However, similar low-level conditions seen in 2003 that warranted a national electricity conservation campaign are still a long way off. Barring major unexpected equipment failures, there is less than a 2% risk of experiencing critically low lake levels.


Reducing Your Electricity Costs

Consumers on spot tariffs are advised to keep an eye on their provider’s prices and watch for price spikes. Flick Electric, one spot tariff provider, has a mobile app that allows users to receive warning notifications when prices increase. To help reduce the electricity rate increase, it’s best to get into the habit of shifting some of your electricity usage to off-peak times.

Taking Advantage of Off-Peak Rates

Are you a spot tariff consumer who is worried about your hydro bill skyrocketing this winter, or are you a fixed rate user looking to reduce costs? Follow the tips below to help keep your hydro bill manageable:

  • Use the dishwasher throughout the night, rather than right after dinner
  • Turn on your clothes dryer during the day, or overnight
  • Use draught stoppers and tighten hinges, latches and hatches to eliminate heat loss
  • If you don’t have central heating, use a heater directly in the room you want to heat and keep the door closed
  • Install energy-efficient light bulbs and fixtures, such as shower heads
  • Ensure you have proper insulation throughout your home

Completely Eliminate the Worry of an Electricity Increase


Spot tariffs eliminate the buffer between your bill and the wholesale price of power, which changes every half hour. Although this type of pricing system can offer long-term savings, consumers need to be okay with weathering periods of higher than average prices.

Consumers who do not want to risk further price increases should consider switching to a traditional, fixed rate or smooth-pay plan.

Let Switchme Save YOU Money!

Has your electricity rate increased sharply, due to the low lake levels? If so, let Switchme help you compare power prices to see if something more reasonable is available! Contact us today for more details and to use our free comparison calculator.

Genesis Energy Profit Flat, In Talks to Keep Huntly Coal-burners Running


Genesis Energy are looking for ways to keep their Huntly coal-burners operating. The closure of these coal units would mark the end of New Zealand's large scale coal-fired generation.

The partially privatised electricity generator reported a $35.9 million profit for the six months to December 31, down from $68.2m previously.

The fall was largely due to swings in the value of financial contracts, with operating profits up 1.5 per cent to $175.5m.

With power demand flat, the last two coal-burning units at the Huntly power station were due to be shut down in 2018.

Chief executive Albert Brantley said Genesis was preparing for the closure date, and had not changed its position that use of the units would continue to fall.

However, he said the company was open to approaches from other power companies, and was already engaged in discussions with some of them.

"We will continue to evaluate commercial proposals that could deliver value to our shareholders."

Genesis chairman Dame Jenny Shipley said the company had faced intense retail competition and variable wholesale market conditions.

Profits had held up through better than expected generation output, a focus on customer acquisition, and close attention to expenses.

Shipley confirmed Brantley would leave the company on April 29, to be succeeded by incoming chief executive Marc England.

Genesis announced an interim dividend of 8.2 cents a share, to be paid on April 15.

Source Stuff.co.nz