Quarterly Business Update Three months ended 31 March 2012
Commentary – Operating Information Mighty River Power had gains in sales volumes and pricing in both the retail and wholesale markets over the quarter. Electricity sales1 for the three months ended 31 March 2012 increased 7% on the prior comparable period (pcp) to 1,106GWh. This reflected increased sales to commercial customers, which were up 14% on the pcp. Sales volumes to residential customers were the same as pcp despite aggressive market competition driving a 5% reduction in customer numbers compared to the pcp, and a reduction of 2,000 over the quarter. The average energy price earned from customers in the quarter was up 5% on pcp to $111.45/MWh, a less than 1% increase on the previous quarter. Wholesale market prices were significantly elevated during the quarter reflecting very dry conditions in the South Island. Conversely, strong rainfall in the Waikato Hydro System catchment resulted in inflows into Lake Taupo at 38% above average, supporting higher generation and good storage levels. As a result, total generation volumes were up 14% on pcp to 1,765GWh and Net Sell CFDs2 were significantly increased (up 54%), driven by new short-term inter-generator contracts as competitors sought to manage their risk due to the adverse national hydrology conditions. Generation volumes were driven by increased hydro (up 16% to 1,132GWh) and gas fired generation (up 159% to 101GWh), reflecting both favourable hydrology and elevated wholesale market prices. The average generation price achieved during the quarter was $89.91/MWh up 56% on pcp. Geothermal generation volumes were consistent with pcp at 532GWh, reflecting good availability across the four plants operated by Mighty River Power. Reported geothermal volumes will be lower by approximately 30GWh from the next quarter following the sale of a 10% interest in the Nga Awa Purua plant in April 2012. The Company’s wholesale market net position for the quarter was long by 54GWh.
1 2
Fixed Price Variable Volume or FPVV Contracts for Difference
Operating Information3
Electricity Sales FPVV sales to customers
Three months ended 31 March 2012 VWAP4 ($/MWh)
Volume VWAP (GWh) ($/MWh)
111.45
1,106
FPVV purchases from market Spot customer purchases Total NZEM Purchases Electricity Customers (number)
97.76
Volume VWAP (GWh) ($/MWh)
106.44
1,036
Nine months ended 31 March 2011
Volume VWAP (GWh) ($/MWh)
112.94
3,661
Volume (GWh)
108.01
3,566
1,111
3,888
3,797
534
521
1,530
1,632
1,708
62.86
1,632
399,000
87.98
5,417
381,000
60.03
5,430
399,000
Volume (GWh)
Volume (GWh)
Volume (GWh)
Volume (GWh)
Buy CfD
464
397
1,155
853
Sell CfD
941
706
2,466
2,195
Net Sell CfD
477
309
1,312
1,342
Electricity Generation Hydro
VWAP ($/MWh)
Volume VWAP (GWh) ($/MWh)
Volume VWAP (GWh) ($/MWh)
Volume VWAP (GWh) ($/MWh)
Volume (GWh)
89.49
1,132
58.32
975
83.93
3,390
54.94
3,195
111.60
101
260.335
39
97.25
409
126.99
246
Geothermal (consolidated)6
86.67
472
41.79
480
78.70
1,454
49.26
1,457
Geothermal (equity accounted)7
86.92
60
43.91
59
77.68
177
50.46
174
Total
89.91
1,765
57.72
1,552
83.33
5,429
56.65
5,072
$/GJ
PJ
$/GJ
PJ
$/GJ
PJ
$/GJ
PJ
Retail purchases8
8.84
0.15
8.42
0.14
8.76
0.77
8.02
0.76
Generation purchases
8.09
0.96
8.48
0.50
8.10
3.80
7.89
2.50
Gas
Gas Purchases
Carbon Emissions (‘000 tonnes CO2e)
3
Nine months ended 31 March 2012
1,174
381,000
Contracts for Difference
Three months ended 31 March 2011
126
105
454
393
Data for prior periods may be restated to reflect current calculation methodology VWAP is volume weighted average energy only price sold to FPVV customers after lines, metering and fees 5 Reflects the Electricity Authority’s decision to reset prices to around $3,200/MWh. This ruling is currently under appeal. 6 Includes share of Nga Awa Purua generation 7 Tuaropaki Power Company (Mokai) equity share 8 Prices exclude fixed charges 4