'Prudent' power use urged as hydro lake levels plunge

The Electricity Commission has signalled its growing unease with the low level of hydro lakes, saying people need to ensure "prudent" use of power.

Chairman Roy Hemmingway says the "chances are good" New Zealand will have enough power this winter, but warned the risk of shortages was increasing with each day that passed without significant inflows to the southern hydro electric lakes.

"If the situation gets worse, the public may be asked to undertake more conservation acts.

"We're not in trouble now, but there is certainly a greater risk than there was a month ago, and if this trend continues there will be an even greater risk a month from now."

Mr Hemmingway said the commission had started looking at what would need to be done to put a power saving campaign in place, but a national savings campaign would not start until power supplies reached a critical point known as the "minzone".

This occurs either when hydro storage falls below the minimum level required to meet electricity demand even when all available thermal plants are running at full capacity or when electricity prices on the spot market reach $200 per megawatt hour (MWh).

The commission revised its minzone this week, a step Mr Hemmingway acknowledged would increase the risk of power shortages.

National energy spokesman Nick Smith said the 15 per cent revision to the minzone was "hugely significant".

"Ministers' assurances of 'no rolling blackouts this winter' have been based on incorrect advice," Dr Smith said.

"It's now highly likely that a consumer savings campaign will be required to help avoid blackouts."

Dr Smith said the revision came because the commission had overestimated the generation from the Waitaki catchment and the Huntly power station.

"Meridian and Genesis have been saying for months that the commission has been wrong, and this change shows their concerns were justified," he said.

The situation had exposed how fragile New Zealand's electricity supply would be this winter.

"It's an indictment on Labour's failure to plan for new electricity infrastructure that we are set to have the third power crisis in just five years," he said.

Acting Energy Minister Trevor Mallard said yesterday the electricity system should be able to satisfy demand this year, but the situation could worsen.

"The Electricity Commission is keeping me regularly informed about the security of the supply situation, and it would be fair to say that with the lakes at their current levels, I'm listening very carefully," he told the Employers and Manufacturers Association (Central) energy forum.

"While I'm currently advised that we can expect the electricity system to be able to meet the demands ... this year, I acknowledge that the margins are getting very tight and the situation could get worse."

Mr Mallard said the fact New Zealand did not have to rely on oil for its electricity supply as much as other developed countries was good for the environment, for the long-term security of supply and ultimately for prices.

- OTAGO DAILY TIMES