Genesis Energy's Huntly Power Station. Photo / NZ Herald
Genesis Energy's Huntly Power Station. Photo / NZ Herald
Genesis Energy said declining lake levels and continued gas production constraints required the company to use its thermal backup to support New Zealand's electricity requirements over the September quarter.
The company, which runs the coal-and-gas-fired Huntly Power Station, said in its first quarter report that hydro storage fell to 58per cent of the average before a recovery in September, resulting in its back-up thermal generation being up 20 per cent on the previous corresponding period.
Genesis' own hydro generation was flat compared with the previous corresponding period, but lower inflows meant storage ended the quarter below average at Waikaremoana.
Mercury Energy, which runs nine hydro stations along the Lake Taupō-fed Waikato River, said inflows into the Taupō catchment were lowest on record over the 12 months to September 30, reflecting continued drought conditions.
The company said its hydro generation in the first quarter was 142 gigawatt hours (GWh) below average, decreasing by 170GWh to 1044GWh.
Mercury announced during the quarter that its 2021 hydro generation forecast reduced by 200GWh to 3700GWh, more than 300GWh below average.
The company's geothermal generation was stable.
Dry weather affected both the North and South Islands, resulting in national hydro storage tracking more than 500GWh below average until late September before lifting due to South Island rainfall, ending the quarter at 172GWh below average, Mercury said.
This was reflected in the average spot price for the quarter reaching a record of $136/MWh at Ōtāhuhu, increasing from $125/MWh in the prior comparable period.
Full year 2021 futures prices also reflected current dry hydrological conditions, increasing from $114/MWh at Ōtāhuhu and $104/MWh at Benmore at the start of the quarter to $122/MWh and $111/MWh respectively.
Longer-term futures prices increased during the quarter as the market appeared to speculate on the likelihood of the Tiwai Point smelter operation being extended beyond its announced closure, due to take place in August 2021.
