Security of Supply and ERCs

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Latest Weekly Update Reported on 18 October 2022

(based on data at midnight 16 October)

Security of Supply and Capacity

Energy

Hydro storage sits at 134% of average for the time of year, a decline of 4% since the previous week. South Island inflows are now below the historical average and hydro generation remains high causing South Island storage to steadily decrease. South Island spring melt starts late this month and ends around February-April. Meridian's snow storage chart is indicating above average snow pack this year of about 257GWh.

NIWA's seasonal climate outlook predicts that La Nina conditions are very likely to continue through to December this year with below average rainfall to the southern hydro catchments. They are also forecasting a possible "triple dip" La Nina during summer/autumn next year. La Nina summers typically bring below average inflows. This would be the first "triple dip" La Nina since 1998-2000. 

Capacity

Temperatures are increasing as we head further into spring with NIWA forecasting above average temperatures across the country. With warmer temperatures our NZ Generation Balance planning tool is indicating no potential generation shortfalls over the next 200 days. This assumes all generation not on outage is offered and at least 20% of wind generation capacity is available. Please click here for more information.

Electricity Market Commentary

Weekly Demand

Demand continues to drop as we move further into spring. Temperatures were warmer compared with the previous week and consequently we saw total demand decrease to 768 GWh. Demand peaked 8:30 am Friday morning at 5,733 MW.

Non-conforming load at Ashburton has increased by about 50 MW over the previous week as irrigation load is coming on in the region.

Weekly Prices

Prices are relatively low reflecting high hydrology, increasing during periods of low wind and high demand. The average price at Hayward was $33/MWh and peaked at $123/MWh at 18:30 on Tuesday.

Generation Mix

Wind generation remained about the same as the previous week comprising 7% of the energy mix. The percentage of renewable generation still remains high for this time of year compared with the previous four years at 94%.

HVDC

The HVDC was in north flow for most of the week reflecting high hydrology, with periods of southward transfer during times of low overnight demand.

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 720.34 KB ]
Electricity Risk Curve Data [ xlsx 54.09 KB ] (Effective from 23 September 2022)
Simulated Storage Trajectories Files

Simulated Storage Trajectories [ pdf 249.3 KB ] (Effective from 23 September 2022)

Assumptions and Update Logs
Electricity Risk Curve and Simulated Storage Trajectories Assumptions [ xlsx 43.81 KB ] (Updated 23 September 2022)
Electricity Risk Curve Update Log [ pdf 8.05 MB ] (Updated 23 September 2022)

Electricity Risk Curve and Simulated Storage Trajectories Assumptions [ pdf 357.49 KB ] (base document effective from 21 May 2021)

Scenarios
 

Low Gas Scenario [ pdf 751.81 KB ] (August 2022)

Simulated Storage Trajectories - August 2022 - Low Gas [ pdf 249.5 KB ] (August 2022)

No Gas Swap Scenario [ pdf 1.22 MB ]  (Updated March 2022)

Simulated Storage Trajectories - No Gas Swap Scenario [ pdf 279.21 KB ] (Updated March 2022)

 

No Third Rankine Scenario - January 2022 [ pdf 1.06 MB ]

Simulated Storage Trajectories - No Third Rankine Scenario - January 2022 [ pdf 765.96 KB ]

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 80% of full and North Island storage at 86% 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 above 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 94% of total generation, with hydro generation accounting for 68% 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 no security of supply consultations currently open.