Genesis Energy's outgoing chief executive Marc England. Photo / Michael Craig
Genesis Energy has an array of renewable power generating assets up and down the country.
There is extensive hydro capacity in the central North Island and the South Island, plus the Hau Nui wind farm in the Wairarapa. The company also has a 46 per cent interest in the Kupe joint venture, which owns the Kupe oil and gas field off the South Taranaki coast.
But Genesis is perhaps best-known for the coal- and gas-fired power station at Huntly.
As New Zealand decarbonises, it's likely that Huntly will come into sharper focus.
But as outgoing chief executive Marc England says, the Huntly plant is going to be around for a long time yet.
In addition to its day-to-day power generating and retailing activities, Genesis has a third job - providing backup for the power grid when the hydro lakes are low, and when the wind stops blowing.
"It's interesting for that reason," says England, who this month leaves his $2.44-million-a-year job to head New South Wales electricity distributor Ausgrid.
"The thing that we hold true to is being consistent in our message and what the opportunities are in New Zealand, but also being consistent around some of the stark realities.
"I think New Zealand has an amazing opportunity to decarbonise its energy system - possibly faster and better than many other economies who are working their way up the chain in terms of moving away from coal-fired power generation, for example, into other renewable forms.
"New Zealand - at almost 85 per cent renewable and confidently heading to 90 and possibly 95 per cent by the end of this decade - is way ahead.
"And it has that opportunity then to think about how we decarbonise energy."
Paradoxically, England argues that since Huntly was built in the 1980s, it has enabled more renewable energy to come on stream than would have happened otherwise.
"I do honestly believe that New Zealand would not have been able to have as much renewable electricity over the last 30 or 40 years without the Huntly Power Station.
"It's a hard thing to explain, but effectively it enables that renewable system to work, because the renewable system in New Zealand is predominantly hydro."
"The inconvenient truth is that the hydro system does not have that much storage - unlike the Hoover Dam [in the US] or the big, deep dams in Norway - it does not have that much storage."
England says it can take as little as six to eight weeks to go from a "wet" situation to a "dry" one for power generation.
"Huntly was built to provide that backup and you can attribute some of the stability that we have seen in the system over the last 30-40 years - the economic growth in New Zealand and how industry has evolved - around being able to rely on electricity.
"I don't go so far as to try and claim that the Huntly Power Station has saved carbon emissions, but compared to many other economies which have had a lot of coal-fired power generation over the last 20, 30 or 40 years, I think New Zealand has done a pretty good job."
Even so, England says a lot can still be done to decarbonise Huntly.
Aside from its prominent coal- and gas-fired Rankine generating equipment, Genesis has gas-fired units at Huntly that provide continuous, baseload power to the grid.
As New Zealand builds more wind and solar, Genesis can displace some of that baseload thermal and reduce its emissions.
The further New Zealand goes down the renewables path, the more important Huntly's backup role will become.
"We have tried to make the case to explain that," says England. "It's not self-serving, although it does serve Genesis to get that right."
Apart from anything else, Huntly's location - close to the main demand centres of Auckland, Hamilton and increasingly Tauranga, and situated at the end of the Maui gas line - makes it essential.
Huntly's Rankines can run on coal or gas, but the company has high hopes for biomass.
An engineering study last year showed that if Genesis could run one or two of its Rankines on biomass, the plant could carry on through to 2040 while providing a reliable backup to the system.
The station's gas turbines will need to be replaced but Genesis has consent to install gas peaking units at Huntly.
"I don't see the Huntly Power station going anywhere very soon," says England. "But the way it operates, the form and its emissions, will evolve.
"I would not want to be the Government that let it go - it is so critical to the backup of the system."
The biomass that Genesis hopes to use comes in the form of dark pellets typically produced from forestry or timber mill waste, which can be ground into a powder and injected into a furnace in much the same way that coal is.
Genesis will be doing a test burn of biomass brought in from overseas later this year.
"The most important thing about biomass is that in a true energy security emergency you could still convert a unit at Huntly back to coal. You would not want to do that, but if you had to, that's really important.
"My view is that if New Zealand could get in behind biomass as its primary thermal backup fuel over the next 10 to 15 years, you could still have that true energy backup to avoid the lights going out if we had proper drought or a gas outage."
As England sees it, there is a paradox.
"New Zealand has a relatively independent energy system with all these indigenous sources, but we must not cut off the umbilical cord, which is coal."
Some European countries such as Denmark have the luxury of pursuing a renewable energy strategy while still being able to call on their neighbours when supply is constrained.
English says New Zealand has one of the best chances in the world to decarbonise its energy system with electricity.
He sees the future system being driven by biomass, backed up in extreme emergencies by coal.
Longer-term, batteries with the ability to last for weeks rather than just hours could share some of the load.
After six-and-a-half-years in the top job, England has enjoyed a good reputation in the market.
"My view on Marc is that he has been a very capable pair of hands in a business which is challenged with the assets they have and the thematic of decarbonisation versus the reality of having industry and political pressure for keeping the country's lights on," says Craig Stent, executive director and portfolio manager at Harbour Asset Management.
"From an operational and profit perspective, Mark has largely delivered on the strategy and profitability targets he laid out 2016/17 despite some challenges."
When England leaves this month, chief customer officer Tracey Hickman will be interim chief executive.
Malcolm Johns, the current chief executive of Christchurch International Airport, is due to take up the top role at Genesis in March next year.
Late last year, Genesis Energy announced that chief operations officer Nigel Clark and chief digital officer James Magill would leave the company to move back to Australia. The chief financial officer, Chris Jewell, also resigned.
While England enjoys a good reputation among analysts and fund managers spoken to by the Herald, one asked if the departures may have resulted in some disruption.
The Englishman turns to sporting terminology to explain.
"I don't want to sound arrogant, but I think that it partly shows we are victims of our own success.
"The executive team for five years pretty much didn't change and we have delivered some amazing outcomes.
"Everyone in the team deserves credit for it, as well as many others in the business, over that timeframe, so people get offered better jobs.
"I've had two of my executives go over to Australia, one for personal reasons and the one to be CFO of a solar company.
"Now, our chief people officer [Nicola Richardson] is off to ASB, so they have all moved on to things that they really wanted to do," he says.
"I think that that's just natural in business.
"If you have been a successful team for a while, people want to go off and do other things.
"That's not a sign of a problem at Genesis - it's because we have done reasonably well over that time frame."
England likens organisations to "rolling mauls " in rugby parlance, where players bind around the ball carrier, separate, then rejoin to take the ball forward.
"People peel off. People come in, and the maul keeps moving forward.
"It's amazing when you look at organisations.
"Even the chief executive can peel off but the organisation just keeps going because they are an organisation that is defined by process, culture, legacy, capability, brand - those things don't change when people go."
England believes there can be too much emphasis on the individual.
"The collective really matters and people matter over the long term - absolutely - but an individual never matters that much," he says.
"Not even the CEO."
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