Lake Pūkaki - New Zealand's biggest hydro lake. Photo / Supplied
Water storage levels in the country’s hydro lakes have plunged in the last month but New Zealand’s largest power generator is hopeful that forecast heavy rain this week could turn that around.
Meridian said in an update to the NZX yesterday that in the month to March 10, national hydro storage fell from 91% to 76% of the historical average.
Total water inflows into New Zealand’s hydro lakes in the first two months of 2025 represented the lowest recorded start to a calendar year since records began, it said.
However, with severe wind and rain forecast for the central and southern parts of the country early this week, the situation could quickly change.
A greater contribution from Meridian’s wind power assets could also help to reduce the draw of water off Lake Pūkaki - the country’s largest hydro storage lake.
Conditions have been drying out since December.
Meridian’s general manager wholesale, Chris Ewers, said rain this week could make all the difference.
“We will see how it plays out, but jeepers it looks promising,” he said.
He noted the first few millimetres of rain is quickly absorbed into the ground after a dry spell.
High pressure weather systems bring not just dry spells but can also mean calmer wind conditions.
“With these frontal weather systems coming across the country you get wind as well, so it’s a double whammy for wind and hydro.
“The important thing is that we have plenty of time between now and when things dry up in winter.
“The key thing is that the sector has responded early to what we have seen since December, and we have learned a lot from last winter around thermal fuels and the lack thereof,” he said.
In February, Meridian and New Zealand Aluminium Smelters (NZAS) struck a deal for NZAS to provide 50MWh of “demand response” this winter.
The agreement means NZAS - the country’s biggest electricity user - can cut back its power demand when the system is stretched.
Other precautionary measures have included Genesis Energy significantly increasing the coal stockpile at its Huntly Power Station.
On the wholesale market last week, low lake levels saw prices reach around $350 a megawatt hour (MWh), up from $295MWh a month earlier, but still well short of last August’s peak of $800MWh.
In its regular operational report Meridian noted February was warm and dry for most regions, with temperatures above average across most of the country.
Rainfall was below normal or well below normal in almost all regions.
National electricity demand in February 2025 was 5.2% lower than the same month last year.
Data from consultancy, EnergyLink, showed the system leaned on thermal generation in the week ending March 16, with it contributing 22% of generation.
South Island hydro was responsible for 32%, North Island hydro 10%, geothermal 24%, and wind 9%.
Co-generation and solar made up the rest.
Last week, the Electricity Authority said low lake levels had made it strengthen the rules around the security of supply.
The regulator said an urgent code amendment would give grid operator Transpower enhanced information-gathering powers so that it can find out exactly how much thermal capacity is available to the system when hydro and other renewable power sources are constrained.
Jamie Gray is an Auckland-based journalist, covering the financial markets and the primary sector. He joined the Herald in 2011.