After being depleted during winter 2024, Huntly’s coal stockpile had been replenished to over 500,000 tonnes.
In line with undertaking to maintain this level, Genesis had ordered just under another 500,000 tonnes to be delivered between now and September.
Genesis has also put in place options for further orders of nearly 200,000 tonnes if necessary.
Johns said Genesis’ generation and coal supply was sufficient to cover its own customers’ needs during winter 2024.
“Providing there are no large, unexpected generation asset failures or supply disruptions across the system, we believe we have enough coal lined up to be able to support demand beyond our own customers this winter as much as we can,” he said.
Whether the extra coal is needed depends entirely on whether rain tops up the hydro lakes, he said.
Last week, the big four power companies teamed up to look at ways of extending the life of Genesis Energy’s coal and gas-fired Rankines at Huntly to improve security of power supply.
Genesis said then that the move was in response to market conditions last winter when the market experienced a “pinch point” due to a combination of a faster-than-expected decline in gas supply, low hydro lake levels, and very light wind conditions.
Huntly backs up New Zealand’s security of supply by providing coal and gas-fired electricity to the hydro-dominated grid when lake levels are low and when the wind drops.
One of Huntly’s Rankine units was scheduled to retire in 2026 and the other two in the early 2030’s.
In today’s statement, Genesis said the agreement with the other generators had given it confidence to lift its orders.
Last year Genesis successfully auctioned 85 megawatts (MW) of new supply contracts, known as Huntly Firming Options (HFOs).
The HFOs offer electricity market participants two-year contracts on flexible generation at Huntly.
Advanced fuel orders are made by the HFO holder with Genesis arranging for the fuel to be delivered and stored ready for use.
On capacity this coming winter, Johns said that the company would once again do what it could to make Rankine capacity at Huntly Power Station available to the market as needed.
Generally, Genesis operates up to two 240 MW Rankines in support of its own customers, holders of HFOs and other forward contracts.
Subject to plant and people availability, it can operate a third 240 MW Rankine in an emergency or, with planning, for around three months at a time.
“This planning is well advanced, and we have made some additional proactive capital investment into the back-up Rankine with winter in mind,” the company said.
New Zealand power prices look likely to remain elevated this year.
Wholesale prices last week were around $300 per megawatt hour (MWh) - up from $104.06MWh a month ago - reflecting lower lake levels.
The big power companies are keen to avoid a repeat of last winter’s spike, when prices peaked at over $800MWh.
ASX futures prices at around $300MWh-$350MWh for the second and third quarters of this year from $106MWh-$200MWh a month ago.
- Jamie Gray is an Auckland-based journalist, covering the financial markets and the primary sector. He joined the Herald in 2011.
