Genesis and Meridian boost profits

Hydro lake levels may be down, but profits are up for New Zealand's two biggest state-owned electricity companies, Genesis and Meridian.

Electricity generator and energy retailer Genesis Energy, posted a net profit after tax of $47.5 million for half year ended December, up $2.4 million on the previous December half.

Chief executive Murray Jackson said the profit rise reflected higher generation revenues and lower operating costs.

Total operating revenue rose to $969 million from $715 million.

Meanwhile, Meridian Energy posted a net profit of $752.9 million for the period, or $112.7 million excluding the profit from the sale of its Australian subsidiary Southern Hydro. This compared to a $96.1 million net profit for the previous December half.

Genesis' Huntly power station ended the year with an annual record output of 6047 gigawatt hours.

Coal consumption was a record 2.4 million tonnes.

Genesis is working to increase its capacity through a variety of projects, including e3p - the Huntly Energy Efficiency Enhancement Project, a 385 megawatt (MW) combined cycle gas turbine (CCGT) at Huntly, which is on track for commissioning in December this year.

Genesis has also started work on the proposed 360MW Rodney power station, next to State Highway 16, north of Helensville.

Other developments under way include Awhitu Wind Farm, an 18-turbine wind farm development near Waiuku in Franklin Country, which was granted resource consent by the Environment Court during the half year.

Meridian's chief executive Keith Turner called his company's result satisfactory, given the poor hydrology conditions in the southern hydro lakes for the period.

He said hydro inflows on the Waitaki and at Manapouri were significantly below average for most of the half-year, and for the December 2005 quarter, inflows on the Waitaki were the third-lowest on record.

"In response, spot prices rose sharply, and during this time Meridian has been purchasing energy to meet customer needs to make up for its reduced generation output," Dr Turner said.

Meridian is also looking to boost its generation, and plans to start work on a 58MW windfarm in Southland, dubbed Project White Hill.

Meridian has also received resource consent for a proposed 210MW windfarm at Makara on the south coast of Wellington, but this consent has been appealed. The Environment Court will hear the appeal in the middle of the year.

Meridian also has to deal with the invasive algae didymo, which has been discovered in waters feeding its hydro stations.

"We are working with other stakeholders to assess the likely risks presented by didymo, and the costs of protecting our assets," Dr Turner said.

- NZPA