Electricity Prices Increase Because of Low Rainfal

Low hydro lake levels and power stations halting generation for routine maintenance contributed to an increase in average wholesale electricity prices last month.

Monthly average prices at the two locations used as reference points increased substantially in March. Benmore, the South Island reference point reported a considerable increase in the average monthly price to 5.02 c/kWh, up from 4.38 c/kWh in February. The price at the lower North Island reference point of Haywards also recorded an increase to 5.18 c/kWh from the previous month’s figure of 4.63 c/kWh. The average price at Otahuhu (used as a reference for the upper North Island) rose slightly to 5.29 c/kWh from 5.01 c/kWh.

Storage levels declined in March due to below average inflows into the main hydro lakes, however towards the end of the month major rainfall into the southern hydro lakes improved lake levels. At the end of March, national storage was at 2,735 GW/h, which is 86% of the average for this time of year and South Island storage was at 88% of average.

The dwindling lake levels throughout most of the month continued an unusual trend where the North Island supplied the South Island with small amounts of electricity in early morning periods.

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