He confirmed to Engineers' Institute in Wellington yesterday morning what the energy industry has been saying for months - that the Independent Expert's report on reduced remaining Maui reserves has created uncertainty in the electricity industry about the adequacy of thermal electricity generation.

"This uncertainty means much more coal and fuel oil will have to be burnt this year - and next year, and the one after that," said Hodgson.

He also acknowledged that incentives for the industry to build enough dry-year reserve generation in a timely fashion had not worked well enough, even taking into account the unpredictability of Maui.

Maui, with its faltering production cannot be ramped up again as it was, to an average of 114%, during the critical winter months of 2001.

New Zealand is facing a possibly bleak power winter, with electricity demand up about 5% on 2002, inflows into the main hydro lakes only 70% of average and mean hydro storage about 76% of average.

Genesis Power has already announced plans to import up to 500,000 tonnes of coal from Australia and Indonesia to use at its dual-fueled Huntly power station as an added buffer against reduced Maui gas supplies and a cold dry winter. This is in addition to its 800,000-tonne deal with government-owned coal miner Solid Energy.

Hodgson also said he wanted thermal electricity generators to release more details on thermal fuel supplies because hydro generators needed a good understanding of the availability of thermal generation so they could make good decisions about how to use their water.

"Markets work best when they are well informed. So I am making it clear to those holding the relevant information on thermal fuel supplies - including State agencies - that I want this data reaching the market sooner," he added.