High inflows result in lower electricity prices
High inflows result in lower wholesale electricity prices in June
While electricity demand increased, good inflows and healthy storage levels resulted in a reduction in average wholesale electricity prices in June. The average price for June at the Haywards reference node was 3.35 c/kWh, down from the May average of 4.42 c/kWh. The average price at Benmore, the South Island reference node, also decreased from 4.26 c/kWh in May to 2.72 c/kWh in June.
Prices at Otahuhu, the upper North Island reference node decreased from 4.55 c/kWh in May to an average of 3.63 c/kWh for June.
June inflows were 155% of the average and by the end of the month storage was 149% of average. Storage levels began the month at 3,594 GWh and by 30 June were at 3,899 GWh. As a result of the favourable hydro situation, flows across the inter-island link continued to be mostly northward. Southward flows were minimal, and occurred only in early morning and near-midnight trading periods.
Average daily demand for June was 109.6 GWh, an increase on May’s 105.1 GWh. From 24 June, an unplanned partial outage of the HVDC link restricted inter-island flows. This resulted in prices between the islands becoming ‘separated’, with North Island prices being significantly higher than South Island prices. During the evening peak period on 29 June, the HVDC restrictions combined with a shortage of standby reserve (back up generation and interruptible load) saw North Island prices spike to 1.00 $/kWh. A similar situation occurred during the evening peak of 30 June, however North Island prices spiked to only 20 c/kWh.