Quarterly Operational Update Three months ended 31 December 2014 QUARTERLY HIGHLIGHTS
No.2
GEOTHERMAL now New Zealand’s second largest electricity fuel source.
77.
$
66G
c
ASX FY2016 FUTURE PRICES UP
159
GWh
HYDRO GENERATION down – lowest Q2 production in Company history
COMMENTARY
Mighty River Power’s quarterly operating statistics for the period ended 31 December 2014 show a decrease in generation volume, down 1% (24GWh) on the pcp due to a continuation of weak inflows across the catchment. Hydro production of 826GWh was down 159GWh (16%) on pcp – almost 200GWh below the Company’s average, making it the lowest second quarter hydro production since the Company was formed in 1999. However, Lake Taupo storage increased by 37% during the quarter, ending the period at 95% of average. NZ HAS LESS THERMAL GENERATION AND INCREASED DEMAND; ASX FUTURES UP
ASX futures prices have increased across all maturities, reflecting the significant reduction in contracted gas electricity generation in New Zealand, as well as lower coal commitments by Genesis Energy. The reduction of more than 5,000GWh of thermal fuel commitments since 2013 has restored the balance of market supply and demand from an energy perspective. National demand increased by 2% during the period on pcp, meaning electricity consumption was back up to 2011 levels. GEOTHERMAL NOW NZ’S SECOND ELECTRICITY FUEL SOURCE
During the second half of CY2014 New Zealand reached a significant milestone in renewable electricity supply, with geothermal generation replacing gas as the second most important electricity fuel source behind hydro. Geothermal generation has increased by more than 150% in the past decade. Unsubsidised investment, including $1.4 billion by Mighty River Power, has boosted geothermal output from 6.5% of national supply, to 16%. Geothermal is the only renewable not dependant on the weather – running 24/7. It has played an important role in displacing non-renewable generation, and overtaken both coal and gas-fired generation in the past six years, cutting millions of tonnes of emissions. Geothermal made up 40% of Mighty River Power’s total generation for the quarter. SMART METER DEPLOYMENT CONTINUES TO GAIN MOMENTUM
The deployment of AMI smart meters by the Company’s metering business Metrix continued to increase, with 16,000 installations completed during the quarter. A total of 25,000 smart meters have been deployed so far in FY2015, increasing the number of smart meters to 367,000. Metrix expects to commence the deployment of 225,000 smart meters to Trustpower’s residential customers later this year. Mighty River Power will release its financial results for the 6 months ended 31 December 2014 on 24 February 2015.
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
01
OPERATING STATISTICS
Three months ended 31 December 2014
Operating Information Electricity Sales FPVV sales to customers
Three months ended 31 December 2013
Volume (GWh)
VWAP1 ($/MWh)
Volume (GWh)
VWAP1 ($/MWh)
Volume (GWh)
VWAP1 ($/MWh)
Volume (GWh)
112.68
1,077
111.17
1,152
117.31
2,409
117.74
2,582
FPVV purchases from market Spot customer purchases Total NZEM Purchases
78.76
570
546
1,338
1,312
506
606
1,070
1,270
1,134
1,212
2,532
2,710
359
404
719
859
1,493
45.44
1,615
385
382
North Island Customers
350
345
South Island Customers
35
37
Electricity Customers (000’s)
Dual Fuel Customers
41
Buy CfD
Volume (GWh) 544
469
Sell CfD
838
843
End User CfD
554
415
Net Sell CfD2
294
374
3,251
54.80
3,568
Volume (GWh)
Volume (GWh)
894
1,226
1,739
1,780
844
1,112
846
554
VWAP ($/MWh)
Volume (GWh)
VWAP ($/MWh)
Volume (GWh)
VWAP ($/MWh)
Volume (GWh)
VWAP ($/MWh)
Volume (GWh)
79.51
826
51.28
985
75.82
1,755
58.78
1,849
82.69
138
73.22
21
76.60
294
78.69
88
74.28
593
40.96
572
67.65
1,237
50.47
1,217
74.18
55
43.56
58
67.97
116
51.64
104
77.67
1,612
47.67
1,636
72.65
3,404
55.98
3,258
Hydro Gas 3
Geothermal (equity accounted)
73.05
39 Volume (GWh)
Contracts for Difference
Geothermal (consolidated)
Six months ended 31 December 2013
VWAP1 ($/MWh)
FPVV sales to residential customers FPVV sales to business customers
Electricity Generation
Six months ended 31 December 2014
4
Total LWAP/GWAP
1.01
0.95
1.01
0.98
Gas Purchases
$/GJ
PJ
$/GJ
PJ
$/GJ
PJ
$/GJ
PJ
Retail purchases5
9.16
0.21
8.77
0.18
9.21
0.61
8.83
0.60
Generation purchases
5.74
1.376
8.79
0.34
6.936
2.79
8.74
1.09
Carbon Emissions (‘000 tonnes CO2e)
128
86
Metrix AMI Meters (‘000)
367
338
294
217
1.
VWAP is volume weighted average energy-only price sold to FPVV customers after lines, metering and fees
2.
Includes Virtual Asset Swap volumes in both Buy and Sell CfD volumes of 176GWh for the 3 months ended 31 December 2014 and 164GWh for the 3 months ended 31 December 2013 and of 352GWh for the 6 months ended 31 December 2014 and 327GWh for the 6 months ended 31 December 2013
3.
Includes Mighty River Power’s 65% share of Nga Awa Purua generation
4.
Tuaropaki Power Company (Mokai) equity share
5.
Prices exclude fixed transmission charges
6.
Includes the virtual peaker operation
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
02
MARKET DATA
ELECTRICITY GENERATION BY COMPANY FOR THE SIX MONTHS ENDED 31 DECEMBER Mighty River Power Meridian Energy Contact Energy Genesis Energy TrustPower Other
16%
33%
24%
16%
6%
5%
Financial Year HY2014
16%
33%
23%
16%
6%
5%
Financial Year HY2015
Source: Electricity Authority Centralised Dataset, Transpower SCADA
SHARE OF ELECTRICITY SALES (GWh) FOR THE SIX MONTHS ENDED 31 DECEMBER
Mighty River Power Other
18%
82%
16%
84%
Financial Year HY2014
Financial Year HY2015
Source: Mighty River Power Purchases and Transpower SCADA
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
03
OTAHUHU WHOLESALE PRICE AND NATIONAL HYDRO STORAGE LEVELS Storage national average Storage FY2015 Storage FY2014 Rolling 12 month average Otahuhu price 4500
90
4000 85 3500 80
2500 75 2000 1500
$/MWh
GWh
3000
70
1000 65 500 0
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
60
TAUPO STORAGE Average since 1999 FY2014 FY2015 500 450 400 350
GWh
300 250 200 150 100 50 0
Jul
Aug
Sep
Oct
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
04
OTAHUHU ASX FUTURES SETTLEMENT PRICE As at 31 December 2013 As at 30 June 2014 As at 30 September 2014 As at 31 December 2014 80 $77.66
78 76
$76.49
$76.73
$75.95 $75.04
74 $/MWh
$76.08
$75.21
$74.75
$75.13
$74.55
$72.37
72 70
$68.74
68 66 64
FY15
FY16
FY17
Financial Year
BENMORE ASX FUTURES SETTLEMENT PRICE As at 31 December 2013 As at 30 June 2014 As at 30 September 2014 As at 31 December 2014 78 76 74
$73.74 $72.40
$71.55
72
$75.50
$74.65
$74.19 $72.25
$74.13
$72.10 $70.76
$/MWh
70 $67.22
68 66 64
$63.50
62 60 58 56
FY15
FY16
FY17
Financial Year
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
05
NATIONAL CONSUMPTION Tiwai Point Aluminium Smelter consumption National consumption 12,000 9,803
9,566
8,458
8,199
10,000
9,594
9,568
9,802
8,299
8,550
GWh
8,000 6,000
8,363
4,000 2,000 0
1,345
1,367
1,231
1,269
1,252
Q2 11
Q2 12
Q2 13
Q2 14
Q2 15
Financial Year Source: Transpower Information Exchange
NATIONAL CLIMATE SUMMARY
Financial Year
Q1
Q2
Q3
Q4
2015
11.9° C
15.9° C
2014
12.3° C
16.7° C
18.9° C
14.8° C
2013
12.3° C
16.5° C
19.6° C
14.4° C
2012
11.5° C
16.6° C
18.9° C
14.0° C
Historical Average (since 1999)
11.9° C
16.1° C
19.3° C
14.2° C
Source: NIWA, Met Service
MONTHLY TOTAL CONSUMER RETAIL SWITCHING (ICP) NZ Market Churn Annual NZ Market Churn % 25%
40,000
20%
30,000
15%
20,000
10%
10,000
5%
ICPs
% Churn
50,000
0
Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct 07 07 08 08 08 08 09 09 09 09 10 10 10 10 11 11 11 11 12 12 12 12 13 13 13 13 14 14 14 14
0%
Source: Electricity Authority
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
06