Mighty River market share, prices fall

The Nga Awa Purua Geothermal Power Station owned by Mighty River Power, whose falling share price is likely to weigh on Genesis Energy. Photo / APN

Mighty River Power's share of electricity sales has dropped compared to a year ago and prices it's getting for power have tumbled. The company's shares hit a new low in early trading today.

Operating figures released this morning show its share of electricity sales around the country dropped 2 per cent to 18 per cent in the six months to December 31 compared to same period a year earlier.

In the three months to December 31 Mighty River's average sales price to residential and commercial customer was $111.17/MWh - up just 0.6 per cent - compared with $110.52/MWh in the previous corresponding period. It has committed not to raise prices to residential customers until at least April 1 next year.

And while MRP says it is outperforming its competitors, the average price achieved for its generation has fell from $66.25/MWh at the end of 2012 to $47.67/MWh in the final quarter of last year.

Nearly half the company was floated on the NZX last May in part of the government's partial sale of energy companies. Shares were sold to the public for $2.50 and spiked soon after listing to $2.73 before steadily declining. They were trading at $1.95 this morning.

Operating figures show for the quarter ended December 31 show customer sales volumes were down 9 per cent in the quarter as the company continued to reduce sales volumes in the low-price, low-margin commercial market.

The company said that in the residential market, seasonal demand was 5 per cent lower on a per customer basis primarily due to high seasonal temperatures.

The average temperature in the quarter was 16.7C, compared to the 15-year average of 16.1C.

South Island customer numbers are down 14 per cent to 37,000 as a result of the company temporarily reducing acquisition and retention activity over the past year in the south due to the market risks before the final commissioning of Transpower's upgraded inter-island link.

Mighty River has also built up storage in Lake Taupo following the drought at the beginning of last year.

Lake Taupo storage was up 26 per cent over the quarter from 338GWh at September 30 to 426GWh which is 97 per cent of average.

Total generation was down 5 per cent on the last quarter of the 2012 calendar year, largely as a result of hydro generation falling 15 per cent as MRP built up lake levels at Taupo.

The lower hydro generation volume was partially offset by higher geothermal production with the additional output from the new Ngatamariki plant near Taupo, completed in September last year, and increased fuel availability at Kawerau with a new larger consent secured for fuel.

Generation at the Nga Awa Purua geothermal station was lower because of equipment problems, and the station currently has a reduced operating capacity (down about 10MW) until the first half of the 2016 financial year when the turbine is scheduled to be repaired and restored to full capacity.

Geothermal production for the quarter was 39 per cent of total generation, versus 31 per cent in the previous period.

Mighty River Power will release its results for the six months ending December 31 at the end of February.