Electricity Prices Highly Volatile In October

The key feature of the wholesale electricity price during October was very high prices (or price spikes) in peak consumption periods. However, the average wholesale electricity price for the month fell in comparison with September’s average.

Demand and off peak prices fell during October as spring temperatures began to rise. However, prices soared in the North Island during weekday breakfast times and in the early evenings as transmission lines neared their maximum capacity.

At 8am on 26 October 2000 a large price spike occurred at a point on the national grid near Huntly and a half-hour price of 561.8 c/kWh was recorded. The price spike was caused primarily by a transmission constraint across the national grid between Hamilton and the Bombay Hills and an outage between Arapuni and Meremere. At the same time wholesale prices around the country also spiked. The South Island reference point of Benmore recorded 34.81 c/kWh, the North Island reference point recorded 37.64 c/kWh, while the typical Upper North Island price was 66.17 c/kWh.

The average monthly price for Haywards was 2.52 c/kWh, a fall from 3.38 c/kWh in September. Benmore also recorded a decrease in price to 2.05 c/kWh from 3.01 c/kWh in September.

At the end of October, South Island storage was 2,918 GWh, 160% of the average for this time of year. National storage was at 3.464 GWh, which is 148% of the average for this time of year.

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