Wholesale Electricity Prices Reflect Demand

Wholesale Electricity Prices Reflect Demand And Inflows

5 March 2002

Wholesale electricity prices trended up slightly during February following a 5% increase in national demand compared to January and lower than average inflow levels.

Natural Gas Corporation's Taranaki Combined Cycle power station (also known as TCC) was out for maintenance in the middle of February, which also contributed to the rise in the average wholesale price. However, balancing this, Contact's Otahuhu B plant generated all month after being unavailable during much of January.

Average prices took a slight upswing around 20 February mostly due to outages on the HVDC cable connecting the North and South Islands.

Storage levels decreased by 10% during February and at month's end were 95% of average at 3,191 GWh. Lakes Tekapo, Pukaki and Taupo were all more than 85% full at the end of the month.

North Island generation steadily increased during the month as a percentage of nationwide generation. This meant the regional variation that was so marked in the first month of 2002 was almost entirely absent during February.

The average half-hour wholesale electricity price for the South Island reference point, Benmore, was 3.25 c/kWh in February, up considerably on 1.61 c/kWh the previous month. Haywards, the North Island reference point recorded 3.48 c/kWh up from 2.98 c/kWh in January. Otahuhu, often used as an indicator of upper North Island prices, recorded an insignificant increase of 3.80 c/kWh up from 3.78 c/kWh in January.

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