Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Meridian suffers low SI wholesale prices in Dec 1/4

Meridian suffers low South Island wholesale prices in Dec quarter

By Pattrick Smellie

Feb. 1 (BusinessDesk) - Meridian Energy achieved barely half the average price for wholesale electricity as its Auckland-based competitor, MightyRiverPower, the state-owned power company's update for the December quarter shows.

The average price per Megawatt hour per customer for Meridian over the three months was $31.21 per Megawatt hour, while MRP said in its quarterly update earlier this week it had outperformed the market and achieved an average price of $66.25 per MWh.

Both state-owned generator-retailers are slated for partial privatisation, possibly both this year. The timing depends on the outcome of a Supreme Court hearing that wraps up in Wellington today, in which the New Zealand Maori Council is seeking to block the sales.

While both are large-scale hydro generators, Meridian's assets are in the South Island while MRP's are all on the Waikato River, fed by Lake Taupo.

During the period, South Island catchments were at times full to overflowing, while Taupo was never as full, suggesting some explanation for better prices from North Island hydro assets.

Meridian also suffered 20 days in the quarter when work on upgrading the high voltage direct current link across Cook Strait had caused "periods of high price separation between the North and South Islands."

Price separation is where the national wholesale market for electricity is broken in two by constraints on the link between the two islands. Completion of the $672 million Transpower upgrade been delayed twice. It is now expected to commission in late April.

The commentary confirms Meridian is one of the few participants in the wholesale electricity market pleased with an unexpectedly radical solution from the Electricity Authority to redistribute the costs of the national grid among users.

"Meridian is particularly pleased that the EA's analysis supports a change to pricing for the HVDC link."

The existing charging regime loads the whole cost of the north-south link on southern generators, even though northern generators get benefit from it.
In the same quarter a year earlier, Meridian's average price per MWh ran at $60.88.

Total customer numbers at 284,673 were steady, and retail churn is dropping at around 18 percent.

Meridian also confirmed it is considering the future of its A$500 million investment in the Macarthur wind farm in a joint venture in Victoria, Australia.

The bond-like structure of the arrangement could make it profitable for Meridian to exit while interest rates are low. However, "no decision is imminent," the company said.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Bullish On China Shock: Slumping Equities, Commodities May Continue, But Not A GFC

The biggest selloff in stock markets in at least four years, slumping commodity prices and a surge in Wall Street's fear gauge don't mean the world economy is heading for another global financial crisis, fund managers say. More>>

ALSO:

Real Estate: Investors Driving Up Auckland Housing Risk - RBNZ

The growing presence of investors in Auckland's property market is increasing the risks, and is likely to both amplify the housing cycle and worsen the potential damage from a downturn both to the financial system and the broader economy, said Reserve Bank deputy governor Grant Spencer. More>>

ALSO:

Annual Record: Overseas Visitors Hit 3 Million Milestone

Visitor arrivals to New Zealand surpassed 3 million for the first time in the July 2015 year, Statistics New Zealand said today. The record-breaking 3,002,982 visitors this year was 7 percent higher than the July 2014 year. More>>

ALSO:

The Future: Thirty Year Infrastructure Plan Released

The Thirty Year New Zealand Infrastructure Plan 2015 sets out New Zealand’s response to the infrastructure challenges we will face over the next three decades, Finance Minister Bill English says. More>>

ALSO:

Shopping: Online GST Discussion Document

GST: Cross-border services, intangibles and goods contains proposals to require overseas suppliers to register and return GST when they sell services (including online products such as e-books, music and videos) to New Zealand consumers. It also outlines the way forward for improving the collection of GST on all goods, including low-value imported goods. More>>

ALSO:

Keith Rankin: Auckland Slowdown?

Has the Auckland housing market turned? I went to a neighbourhood auction yesterday. Solid large 1950s' house on 1,000 square metres of land, sunny section, view over city from front of house, handy to train and to the expanding New Lynn retail and commercial hub. More>>

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news