Security of Supply and ERCs

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Latest Weekly Update Reported on 18 January 2022

(based on data at midnight 16 January)

Current Storage Positions

National hydro storage bucked the rising trend observed at the end of last year and decreased this week to 112% of average for the time of year (87% of full). This was the result of little to no rain events since the start of the year in both islands.

North Island storage decreased 10 percentage points to 118% of the historical average, and South Island storage decreased by five percentage points to 110% of the historical average.

NIWA have announced that La Nina conditions have strengthened over December. This means increased likelihood of normal to below average rainfall in the Hydro catchment areas over the summer months. For more detail click here.

Market Indicators

Weekly Prices

The average price at Haywards was $143/MWh, up 42% from $101/MWh last week.

Prices at Haywards peaked at $351/MWh at 12.00pm on Tuesday 11 January.

Two instances of price separation were seen in Southland during the week.

The first occurring on the 11th of January due to a constraint on the Livingstone-Naseby line, which limited imports into the Southland region. This occurred due to an outage at Clyde-Roxburgh-1.

The second occurred on the 13th of January again due to a constraint on the Livingstone-Naseby line, this time limiting export from the region. This occurred due to an outage on Cromwell-Clyde Twizel-1.

Weekly Demand

National weekly demand was 744 GWh; an increase of 45 GWh (six percent) on the previous week. This is a reflection of the end of the Christmas holiday period where the country begins to go back to normal operation.

After a slow start irrigation load at Ashburton has come online and is presently averaging 2.9 GWh per day in January. This is the highest daily demand average since January 2020 which averaged 3.3 GWh per day.

This week's national demand peak was 5,367 MW and occurred at 5:30 pm on Tuesday 11 January.

Generation Mix

Total generation was 774 GWh this week, with hydro making up 57%, and thermal 12% of the mix. Wind generation comprised 8% of the mix this week.

HVDC

HVDC transfer has remained mainly northward this week, but with instances of southward transfer in the early hours of the mornings.

Electricity Risk Curves

New Zealand and South Island storage are both in the Normal range.

Electricity Risk Curves

New Zealand controlled storage is above average and South Island controlled storage is above average. The graphs below compare New Zealand and South Island controlled storage to the relevant Electricity Risk Status Curves.

The graphs below compare New Zealand and South Island controlled storage to the relevant Electricity Risk Curves - Percentage Risk.

Click here to learn more about the Electricity Risk Curves and thermal fuels validation

Electricity Risk Curve Files
Latest New Zealand Electricity Risk and South Island Electricity Risk Curves [ pdf 621.34 KB ]
Electricity Risk Curve Data [ xlsx 53.84 KB ] (Effective from 17 December 2021)
Simulated Storage Trajectories Files

Simulated Storage Trajectories [ pdf 778.85 KB ]   [ pdf 298.92 KB ](Effective from 15 December 2021)

Assumptions and Update Logs
Electricity Risk Curve and Simulated Storage Trajectories Assumptions [ xlsx 44.98 KB ] (Updated 17 December 2021)
Electricity Risk Curve Update Log [ pdf 6.81 MB ] (Updated 17 December 2021)
Nova Energy - Thermal fuel disclosure - 1 April 2021 [ pdf 92.28 KB ]

Electricity Risk Curve and Simulated Storage Trajectories Assumptions [ pdf 357.49 KB ] (base document effective from 12 May 2021)

Scenarios
  Simulated Storage Trajectories Reduced Gas Demand Flexibility [ pdf 301.63 KB ] (May 2021)
  ERC Reduced Gas Demand Flexibility Scenario [ pdf 814.83 KB ] (May 2021)
  Simulated Storage Trajectories Reduced Gas Demand Flexibility [ pdf 1.47 MB ] (March 2021)
  ERC Reduced Gas Demand Flexibility Scenario [ pdf 1.59 MB ] (March 2021)
  Reduced Demand Flexibility Scenario ERC [ xlsx 13.9 KB ] data (March 2021)
  Simulated Storage Trajectories No Thermal Deratings [ pdf 323.93 KB ] (December 2020)
  ERC No Thermal Constraints Scenario [ pdf 558.69 KB ] (December 2020)

Hydro Information

For security of supply purposes, hydro storage is divided into two categories; controlled and contingent storage. Generators can use controlled storage at any time, but contingent storage may only be used during defined periods of shortage or risk of shortage. During sustained dry periods, controlled and contingent storage are important indicators of overall supply risks. Storage is expressed in gigawatt-hours – GWh (a measure of the energy that can be produced using the water).

Storage decreased in the North Island and decreased in the South Island over the last week, with South Island storage at 88% of full and North Island storage at 78% of full.

Lake Levels

Island Inflows and Storage

The charts below show storage over the last 13 weeks and rolling 7 day inflows for the last year in North and South Islands. 

  • Over the last week (Sunday to Sunday) available storage in the North Island has decreased and the South Island has decreased.
  • Inflows over the last 4 weeks (Sunday to Sunday) in the North Island have been below average and in the South Island they have been below average.
North Island South Island
Contingent Storage

Contingent storage is stored hydro that is only made available for generation at specific times to mitigate the risk of shortage. Current available contingent storage is shown on the following graph.

For more information on contingent storage and the conditions of its use, refer to the documents below.

Contingent Storage additional information [ pdf 167.95 KB ]
SOS101 - Contingent Storage [ pdf 175.52 KB ]

Market Indicators

Demand, generation mix, HVDC transfer and prices can all indicate the market response to the current security of supply climate.

Renewable generation over the last seven days was 85% of total generation, with hydro generation accounting for 55% of total generation.

Weekly Generation

Demand

Electricity consumers range from large industrial sites (the most significant is the NZAS aluminium smelter at Tiwai), down to individual households. Almost two thirds of national demand is located in the North Island. New Zealand's annual electricity consumption ('demand') is nearly 40,000 gigawatt-hours (GWh). If demand differs from expected, it may impact on security of supply.

Generation

Hydroelectric generation contributes around 60% of New Zealand's total electricity supply, with many generators of widely varying sizes distributed throughout the country.

HVDC Transfer

The ability to transfer electricity from one island to the other is an important aspect of managing security of supply, particularly as there are no thermal stations in the South Island to call upon in times of low hydro storage. Net weekly HVDC transfer is shown in the chart below with north transfer from Benmore to Haywards and south transfer in the opposite direction.

Wholesale Spot Prices

Spot prices can be an indicator of security of supply risk. Typically they rise when supply is tight, such as during 'dry years'. Weekly 7 day rolling spot prices for each island are shown in the graphs below. The corresponding prices for the previous year are also included for comparison.

Industry Workshops

We run security of supply workshops on topics of interest to the industry. The 2021 Workshops on Security of Supply are linked below.

3 Jun 21 18 May 21 3 May 21 20 Apr 21 7 April 2021 31 Mar 21 26 Feb 21

Policies, Plans and Publications

Includes information on the Annual Assessment and Transpower policies related to Security of Supply: the SoSFIP, EMP, SOROP and Outage watch List

Security of Supply Consultations

There are currently no consultations on security of supply.