Contact Energy plans to cut more than 100 jobs as part of a $40 million cost saving drive.

The company says its big power station building programme is almost over electricity demand remains weak.

A spokesman said the company aimed to cut 10 per cent of its 1100-strong workforce by the end of the financial year on June 30.

Jobs would be across board at the business, New Zealand's biggest listed electricity company, majority owned by Australia's Origin Energy.


The plans were outlined to 65 managers by chief executive Dennis Barnes at a meeting yesterday.

"There's no particular area - we're looking at efficiencies across the organisation so we can remain competitive,'' the spokesman said.

Contact has its headquarters in Wellington and has power stations in Clyde in Central Otago, Taranaki, Taupo and Auckland.

"We're not going to making any cuts that jeopardise maintenance or safety,'' the spokesman said.

Figures show demand for electricity has been weak during the past year and there are few prospects of an increase.

Electricity Authority statistics show two-year contracts for wholesale power are down 26 per cent on current prices.

The fall results from softening industrial demand for electricity following the drop of production at the Tiwai Pt aluminium smelter and the closure of part of Norske Skogg's Kawerau pulp and paper mill. There is also weak residential and commercial demand for power.

The looming job cuts at Contact follow this month's announcements 192 jobs at Summit Wool Spinners in Oamaru will be lost and about 200 workers at Mainzeal will be laid off in the wake of the construction firm's receivership.