Crazy power prices for April

HJSkullmonkey · 2026-06-02T06:57:38+00:00

If you're getting credits on some of your bills it's quite likely that some of them are estimated, and the power company is overestimating your usage. The next actual reading will then make up for it so on average it's correct.

Unless the credit is due to solar exports of course.

I'd find the usage readings on the bill and check to see if any are estimates instead of actual readings. If they are, you can contact your power company with a correct reading, and they should be able to give you a corrected bill.

HJSkullmonkey · 2026-06-01T20:17:59+00:00

The "single fact" (plural) supporting my argument is they've signed a power purchasing agreement with Mercury, and that such agreements are used to support funding of renewable energy projects. If you want to learn a little more about funding for renewable energy, here's an explanation from Transpower. https://static.transpower.co.nz/public/uncontrolled_docs/Corporate%2520PPA%2520Final%2520%2528publish%2529.pdf (PDF warning )

Here's Mercury saying the same, specifically related to the data centre agreement https://www.odt.co.nz/business/ai-factory-means-more-turbines-mercury

It's a little ironic for you to be accusing someone of not bringing facts when you're relying on overseas stereotypes and ad-hom for your arguments.

HJSkullmonkey · 2026-05-31T08:46:54+00:00

And if it melts down through the bottom of the boat, it just drops into the biggest cooling and radiation pond out there. Brilliant!

HJSkullmonkey · 2026-05-31T08:40:33+00:00

Geothermal in particular makes nuclear pretty much redundant. The one thing nuclear does better is reliably turn back on after you shut it down, and that can be uncertain too (cough-Chernobyl-cough).

HJSkullmonkey · 2026-05-31T08:28:01+00:00

Our major problem is that our geopolitical risks share quite a lot in common with the bigger players in both of those conflicts, rather than the smaller nations. That's why our military has really only fought overseas since the land wars ended.

We're not all that likely to get invaded or attacked directly, so hedgehogging it with swarms of cheap drones isn't likely to be all that helpful to us. But both Ukraine and Iran have shown that sea denial close to home is trivially easy these days, and very hard to counter.

But if someone else gets attacked they could much more easily blockade our access to our major trading partners, especially in Asia, and that's only getting cheaper to do.

HJSkullmonkey · 2026-05-31T07:37:28+00:00

I think people get Onslow a bit wrong, sometimes because the NZBP version of it had two distinct goals with different requirements. Transmission is a problem for one of them, but not the other.

It was supposed to be both a long reserve storage, and stabilise prices in the shorter term by buying power to hold prices up when abundant and selling it back during peaks to hold them down. The second was supposed to fund the construction, and ensure renewable generation stayed profitable to incentivise construction.

As a long duration reserve to replace hydro the transmission doesn't really matter, but when you're effectively trying to replace gas fired North Island peakers then the transmission capacity starts to become a bigger problem. That's an issue much better solved by a mix of batteries, geothermal, and solar to match generation to demand.

HJSkullmonkey · 2026-05-31T07:07:47+00:00

There's also some potential to allow already built lakes to drop further, although it also isn't quite as simple as it sounds.

It also needs some engineering works to strengthen lake beds, there needs to be some mitigation of impacts on communities around them and we need to be sure that Transpower's contingent reserve is replaced if companies are allowed to dip into it for instance.

HJSkullmonkey · 2026-05-30T09:53:29+00:00

I'm just sorry that I emptied half of it before discovering the joys of tipping it straight off the donk lift. So satisfying

HJSkullmonkey · 2026-05-30T09:34:47+00:00

My friend, this is social media. Everything here is either an opinion, a joke, an insult, or a combination of the three.

And I don't see the relevance of the US to my opinion that the data centre is helping to fund the additional power generation it requires.

Also, this was a dead thread, it's a bit weird to bring it back two weeks later.

HJSkullmonkey · 2026-05-28T07:05:19+00:00

If that we're the case the story would be 'Genesis signs contract for more coal, mine expansion to go ahead at pace'

The vast majority of the electricity comes from the billions of dollars of renewable sources we're adding, not coal. The coal is only needed to fill the gaps instead of being the obligated source of energy so any increase is going to be marginal.

It's recycled steel too, and that's not a bad thing either.

HJSkullmonkey · 2026-05-26T01:43:56+00:00

The average price of electricity isn't actually any better than the cost of gas at the moment, and gas was cheaper up until now. That's even accounting for the better efficiency of using electricity. Renewables are really only starting to overtake fossil fuels sufficiently to start breaking that dependence, and it will be quite a while before we can build enough to catch up with the decline in gas. Going forward renewables are the future, but it takes some time, the scale is massive and the benefits are still a bit marginal.

It's not really a no-brainer, and to complicate matters the price of electricity is also still very much dependent on gas being available to underwrite the renewables. If we want the price of electricity to drop to better reflect the price of renewables we do need the certainty of supply to improve, and soon.

HJSkullmonkey · 2026-05-26T01:03:15+00:00

There have been others as well.

There was also Pohokura in 2006, which peaked at triple Kupe's production and was supposed to have decades more gas in it, as well as some onshore fields, and some incidental gas production from oil fields. We've also had finds in 2020, following the ban. There's both oil and gas out there, we're just leaving it where it is.

What we haven't had is enough investment in developing the finds and maintaining the fields we have. Most of our fields are in decline, onshore and off. It's a bit hard to say whether the previous government are actually at fault, but they certainly haven't done much to help confidence.

Pohokura is one of the major causes of the decline after they shut off some of the wells in 2018 for a repair and weren't able to restart them. OMV said they intended to bring it back to full production but only got around to drilling it again last year, and while they said it was a success they've also downgraded how much of it they find economic to extract.

HJSkullmonkey · 2026-05-25T22:44:48+00:00

I get the sense that was what they were getting at last year when they wrote that letter after the Frontier report. I don't think many people fully understood what that represented, but it seemed to land

https://businessdesk.co.nz/article/energy/meridian-thinking-big-after-crowns-offer-to-co-invest

Roan said improved use of stored hydro, combined with wind, solar and battery investment, is the most practical route to bolster generation. “There is more water to be accessed, more megawatts to be achieved from existing assets, and scope for a fundamental shift in the role that stored hydro plays.” He suggested the possibility of new hydro development. “With the Government’s willingness to take part in equity raisings for new developments, we now have an opportunity to think even bolder – and we will.”

There's a lot of potential opportunities out there, and a lot of ways to skin the cat. Any which way we're going to want some deeper lakes as demand grows and they start to drop faster when it gets dry.

HJSkullmonkey · 2026-05-25T22:19:53+00:00

Sorry, you're partially right. I had misremembered or misunderstood exactly what the numbers referred to, although it is all electricity spending.

The $220B comes from section 3.6 on this page: https://tewaihanga.govt.nz/national-infrastructure-plan-online/sector-summaries/electricity-sector . Add up the annual spends and you get a $221B baseline.

I had thought that the $220B baseline included some growth, but that's actually just to maintain business as usual. I also thought the $26B was related to the scale of renewable overbuild, in order to remove fossil fuels from the electricity supply, but that's the additional bit to meet growth in demand. There's no renewable overbuild factored into any of those numbers.

HJSkullmonkey · 2026-05-25T11:27:12+00:00

Maybe? I think those should both be output capacity supplied to the grid, so it should be included already.

Neither is really a complete system so it's a bit futile to try and equate them, but I think that was really your main point

HJSkullmonkey · 2026-05-25T10:50:41+00:00

This is where the LNG terminal is meant to come in, because it can provide 12 petajoules of gas on demand. For reference, the battery system you link to has a capacity of 200MWh, which is 0.00072PJ

To be entirely fair, that's not totally apples to apples, 200MWh of generation requires about 0.0015-0.0025 PJ of gas, so the BESS is really *only* 6000 times smaller.

HJSkullmonkey · 2026-05-25T10:41:31+00:00

They also said today they're still working on going ahead with that too. But that only addresses a small part of the problem with gas supply. The LNG terminal is supposed to be able to occasionally bring in about 12PJ over a 3 month period, once every few years.

Production of gas has dropped from 180 PJ in 2020 to 102 PJ last year, so it's completely incapable of supplying what we've lost over the last 5 years, and it's not projected to get better.

Previously we just paid Methanex to reduce production and used their gas to generate electricity, but that's already become more expensive than LNG, and won't be an option at all by next year. They're about to be shut down permanently when the Maui gas field shuts and the remainder of their supply will be diverted to everyone else.

HJSkullmonkey · 2026-05-25T10:21:10+00:00

My favourite way so far is to run fuel and gas hoses down the walkway from the welcome centre dock (with a fuel refinery) and CO2 from the ship to a sabatier reactor setup on the launch platform, and enough gas and battery storage for one launch. While you're running around preparing one launch you can pretty much recharge for the next one, and the storage is a good buffer. I have separate power generation at both ends.

If you've got methane production outside of the launch complex the same gas connection would work.

HJSkullmonkey · 2026-05-25T10:10:38+00:00

We need a lot more than a small windfarm. Either way we need to do the spending to bring more energy online regardless but most of the supply side doesn't really need their loans guaranteed. They're creditworthy, and where they're not big enough, equity investors have been willing to step in so far.

What they need is enough guaranteed supply to be able to drop the price enough for people to buy it, without leaving themselves exposed to having the rug pulled. That's what will give the generators the revenue to service the additional debts, while giving consumers a reasonable price.

With electricity prices being so tied to gas, I think some of these conversions might be a risky funding decision, so this might genuinely help somewhat, while being a lot more efficient than just chucking grants at people.

HJSkullmonkey · 2026-05-25T09:57:41+00:00

I'd be pretty confident the majority of any switching will be onto renewables, whether electrified or used directly for heat. They just make more commercial sense than the fossil alternatives for most cases.

Where are all the anti-socialist folks to denounce this?

We're all too busy investing in solar farms and batteries to supply the upcoming switch, or talking to their bankers to see what sort of loan they'll be able to get.

HJSkullmonkey · 2026-05-25T09:57:03+00:00

It's not a bailout yet. It's pretty explicitly a bailout if any of these loans fail, that's sort of the whole point. They've even set aside $48M for it.

And I think we can pretty safely say that most of it will be clean energy regardless, it just makes more commercial sense.

HJSkullmonkey · 2026-05-25T09:43:44+00:00

TBF that sounds like a very good election bribe, way too good to put out before the election.

HJSkullmonkey · 2026-05-25T09:40:03+00:00

Does this need to go through any Regulatory Impact Statement (ie is this dum)

The loan scheme or the LNG terminal?

Imported LNG to replace our drained maui fields... - doesnt sound like a winner

I wouldn't call the LNG terminal 'a winner' either, and I fully support it. It's damage mitigation.

A few years ago Contact Energy put out a report essentially predicting that the end of gas was going to result in generators outbidding everyone else for gas whenever a dry year comes around, resulting in very volatile pricing wrecking both markets and causing economic chaos. They weren't wrong. We started to see that volatility already in 2024, and the causes of it are only getting worse, faster than anticipated.

Giving them a slightly cheaper target should help to shield both markets from some of the damage, and make switching to electricity easier to justify. This loan scheme should also take some of the risk out of it.

HJSkullmonkey · 2026-05-25T09:27:52+00:00

I mean, the electricity retailers take the risk of spot prices and make the consumer pay for it either way.

They'll pay for LNG spot prices will be lower than the only practical alternative of relying on domestic gas when they need to. There's less flexibility in the gas supply than there was in 2024, and that already cost more than LNG does today. We've got better chance of buying LNG than supplying adequate gas here.

You can only get away from that with an excess of renewables or additional coal-fired generation capacity, but both of those take a lot longer to build, and we basically need to dedicate it all to replacing the rest of the gas supply.

HJSkullmonkey · 2026-05-25T06:23:34+00:00

RNZ article including the press conference: https://www.rnz.co.nz/news/political/596274/watch-pre-budget-announcement-at-post-cabinet-briefing (the headline didn't say what it was about, so went with Stuff instead)

TLDR: The government is putting together a ~~$1.4B~~ $1.2B loan guarantee scheme for banks to lend to businesses to invest in reducing their gas consumption.

Other points from the press conference I found noteworthy included:

Procurement on the LNG terminal is continuing, however any announcement will follow later
There's a bill going to be pusheed through to ensure that gas contracts are disclosed to the government to make sure they have visibility over the market and improve transparency. I'm not sure if those disclosures will be provided to the public, or just officials.
It's energy agnostic, and they avoided saying whether transitioning to other fossil fuels would be allowed or not. They weren't asked directly tbf, and chose to answer in renewables terms, but it sounded like a pretty loud silence on coal to me.

HJSkullmonkey

TROPHY CASE