Electric Kiwi posted an open letter to Meridian Energy (NZ Herald, December 31).
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The New Zealand electricity market is highly competitive and Meridian has found success comes from focusing on its own game and supporting customers. While we would typically avoid engaging with Electric Kiwi, a number of claims were made that require a response.
Electric Kiwi was right that Meridian is very proud of being New Zealand's largest generator of renewable energy. It is also true Meridian was fortunate that when ECNZ was split up, a large proportion of the South Island hydro generation assets were allocated to Meridian.
But since then our business has been very busy and during the last 20 years we have invested around $3.2 billion in new renewable electricity generation which is more than
double that of any other electricity generator in this country.
That $3.2b is arguably responsible for saving around 1.9 to 4.6 million tonnes of carbon being pumped into the environment every year. We are fairly confident that, since Meridian was formed, we have done as much as any other organisation in this country to combat climate change, so yes, we are proud of what we have achieved.
But we are not perfect, and we make the odd slip up. We got the messaging in one of our advertisements slightly wrong. It wasn't our intention to do that and we changed the ads quickly when this was pointed out. The ads, that have been very slightly modified, are still playing and working well for us.
Regarding the spill event in 2019, the Electricity Authority has concluded that around 28GWh or electricity was spilled by South Island generators that could have been used to generate electricity. The authority spent the last year analysing and consulting on the events of late 2019.
At the time we were dealing in real time with a one in 100 year flood event and, as always, the safety of our dam structures and those communities downstream from those structures was our top priority. Accordingly, a pre-emptive spill on a large scale was both necessary and completely unavoidable if the flood event was to be managed prudently with those safety concerns in mind.
The authority does not dispute this. In fact, Meridian and the other South Island generators spilled around 1870 GWh of water during the flood which we think puts into a wee bit of context the 28GWh that the authority now says, over a year down the track, and with the benefit of hindsight, could have been avoided.
We also generated more electricity in December 2019 than we have ever done in any previous December. Overall we thought we did kind of okay managing that event but the authority has concluded that due to a confluence of factors, including the trading decisions of other generators, we could have done better.
While we don't necessarily agree with the authority's rationale, they are the ultimate rule-making body in our industry so we will do our darnedest to do better in future.
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That said we are not likely to face anything like the flood event from 2019 for many years and hopefully decades.
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Based on every independent study done and all the available international benchmarks, the New Zealand electricity sector serves our country extremely well. The market rules and settings have encouraged high degrees of competition which have delivered efficient, reliable and sustainable outcomes.
The overall system is not perfect and will continue to evolve but despite a lot of rhetoric to the contrary, the facts tells us the system is close to as good as it gets internationally.
The New Zealand Government wants to up the stakes and has a stated ambition to create a 100 per cent renewable electricity grid by 2030. To reach that target, we in New Zealand are going to have to invest around $7 billion in new renewable generation.
I can assure you Meridian will play our part, to do so is entirely aligned with our purpose of clean energy for a fairer and healthier world. We are seeing many other organisations also contributing and are engaged in building new renewable generation or other innovations to reduce energy consumption.
So, we think the Government's ambition is achievable and are excited to be part of it.
Ironically, Electric Kiwi and its related energy trading company Haast Energy are both ultimately majority-owned by investors based in the UK. Retailing electricity is a principled enough endeavour on its own, but as far as we are aware, neither Electric Kiwi, Haast or their UK-based owners have invested any money in supporting new renewable developments in New Zealand (or globally, for that matter).
We'd suggest, Electric Kiwi and its energy trading company could lean in and help out with New Zealand's climate change ambitions.
They may not have much more to add in New Zealand, but every little bit will potentially help and we are more than willing to share our experience and know how, as well as work with investment partners.
If Electric Kiwi really want to help New Zealand take positive climate action, we'd love to have a conversation.
• Neal Barclay is the chief executive of Meridian Energy.