ELECTRICITY

Wet winter keeps NZ power prices down

New Zealand's wet winter is keeping a cap on wholesale power prices and on the profits of thermal...

Contact chief executive Stephen Barrett said the softer wholesale electricity prices were expected to continue to the end of September, Contact's full financial year.

Wholesale electricity prices averaged $NZ45.93/MWh for the first nine months of this financial year, compared with $NZ61.90/MWh for the equivalent period in 2000-01.

"This difference reflects the extremely dry, cold winter experienced in 2001," said Barrett, "for the 2002 winter, (hydro lake) storage levels are close to or above the mean."

Contact's earnings before interest, tax, depreciation and amortisation (EBITDA) for the nine months were static at $NZ219.5 million, compared with $NZ219.9 million for the equivalent 2000-01 period.

Wholesale electricity revenue was $NZ293.7 million, down 24% on the $NZ386.0 million achieved in the 2000-01 period. However, strong growth in retail customer numbers and sales volumes increased Contact's total electricity revenue by 11% to $NZ541.1 million.

External revenues from Contact's gas business for the nine months were $NZ205.3 million, slightly down on last year ($NZ208.1 million), reflecting the loss of some lower margin customers. Total external sales volumes for the period were 37.4PJ, compared with 45.6PJ for the equivalent 2000-01 period.

Contact's total gas and electricity customer base stood at a new record high of 536,000 in June, with much of the recent growth coming from Contact's Empower division, which had moved into several new markets, including Christchurch and Wanganui, targeting business customers as well as households.

In aggregate, Contact's retail electricity sales grew by 20%, with sales totalling 3852 GWh in the nine months to June 2002 (3202 GWh in the 2000-01 period). This increased volume lifted Contact's average level of hedge cover from around 60% to approximately 77%. The average level of hedging through to the end of this financial year was likely to be about 80%.

Barrett confirmed Contact was continuing to pursue the possibility of purchasing some of the Asia-Pacific assets of NRG Inc.

TOPICS:

A growing series of reports, each focused on a key discussion point for the energy sector, brought to you by the Energy News Bulletin Intelligence team.

A growing series of reports, each focused on a key discussion point for the energy sector, brought to you by the Energy News Bulletin Intelligence team.

editions

ENB CCS Report 2024

ENB’s CCS Report 2024 finds that CCS could be the much-needed magic bullet for Australia’s decarbonisation drive

editions

ENB Cost Report 2023

ENB’s latest Cost Report findings provide optimism as investments in oil and gas, as well as new energy rise.

editions

ENB Future of Energy Report 2023

ENB’s inaugural Future of Energy Report details the industry outlook on the medium-to-long-term future for the sector in the Asia Pacific region.

editions

ENB Cost Report 2021

This industry-wide report aims to understand current cost levels across the energy industry