Quarterly Operational Update Three months ended 31 December 2012
QUARTERLY HIGHLIGHTS
12
6
%
ELECTRICITY SALES volumes to customers increased 12%, reflecting growth in residential and business volumes
%
OVERALL GENERATION volumes up 6%, reflecting strong hydro volumes and geothermal reliability
66
$
.25 PER MWh
FLEXIBLE GENERATION portfolio
allowed the Company to outperform the market, achieving an average generation price of $66.25/MWh
COMMENTARY
achieved gains in market share in both electricity sales to customers and generation volumes, in the three months to 31 December 2012.
MIGHTY RIVER POWER
Total sales volumes to customers increased by 12% on the prior comparable period (pcp), with volumes increasing from 1,132GWh to 1,272GWh. The Company saw an increase on the pcp in sales volumes to both residential and business customers, with the majority of the gain coming from a 22% increase in volumes to business customers (557GWh to 682GWh). The price of sales to customers remained consistent with the pcp at $110.53/MWh. Total electricity purchase costs fell 27% (from $83.20/MWh to $61.14/MWh), reflecting lower wholesale prices and the increased transmission capacity with Transpower’s commissioning of the North Island Grid Upgrade Project (NIGUP) at the end of October. Mighty River Power’s total generation volume increased by 6% compared to the pcp. Hydro generation was up by 130GWh (13% on pcp) reflecting effective use of hydro storage, which had benefited from high inflows in the previous quarter. Generation at the Company’s gas-fired power station in Auckland was down by 48% as the Company responded to lower wholesale prices in the market. The continued reliability of the Company’s geothermal generation was evident with volumes up 3GWh (0.6%) due to strong availability across the geothermal plants offset by the sale of 10% interest in Nga Awa Purua (34GWh) in April 2012. Wholesale market pricing fell on the pcp as a result of high national inflows into our competitor’s South Island catchments. This impacted the average price the Company received for its total generation sales, which decreased by 19% on the pcp (from $81.47/MWh to $66.25/MWh). However, the price received during the quarter outperformed the market; supported by the Company’s flexible portfolio and, in particular, the ability to utilise storage and flexible plant to respond to wholesale market prices. In addition, the annual planned outage at Southdown for routine maintenance was moved forward to ensure the plant was available at a time when national electricity supply was impacted by a number of thermal and transmission outages. The Company’s Net Contracts for Difference (CfD) increased by 23% (from 363GWh to 447GWh) on the pcp as a result of increases in locational, ASX and inter-generator hedging for risk management.
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
01
OPERATING STATISTICS
Three months ended 31 Dec 2012
Operating Information Electricity Sales
Three months ended 31 Dec 2011
Six months ended 31 Dec 2012
Six months ended 31 Dec 2011
VWAP1 ($/MWh)
Volume (GWh)
VWAP ($/MWh)
Volume (GWh)
VWAP ($/MWh)
Volume (GWh)
VWAP ($/MWh)
Volume (GWh)
110.53
1,272
110.45
1,132
115.32
2,777
113.58
2,555
FPVV sales to customers FPVV sales to residential customers FPVV sales to business customers FPVV purchases from market Spot customer purchases Total NZEM Purchases
61.14
590
575
1,375
1,408
682
557
1,402
1,148
1,335
1,215
2,964
2,714
543
496
1,089
995
1,878
83.20
1,711
64.82
4,053
83.48
3,709
391
383
391
383
North Island Customers
348
346
348
346
South Island Customers
43
37
43
37
41
39
41
39
Electricity Customers (000’s)
Dual Fuel Customers
Volume (GWh)
Volume (GWh)
Volume (GWh)
Volume (GWh)
Buy CfD
519
321
1,285
691
Sell CfD
966
684
2,139
1,525
Net Sell CfD
447
363
854
834
Contracts for Difference
Electricity Generation
VWAP ($/MWh)
Volume (GWh)
VWAP ($/MWh)
Volume (GWh)
VWAP ($/MWh)
Volume (GWh)
VWAP ($/MWh)
Volume (GWh)
68.05
1,154
83.15
1,024
66.79
2,468
81.14
2,258
106.12
46
101.49
88
85.98
178
92.55
308
58.73
471
75.11
469
59.69
930
74.87
981
60.24
60
73.09
59
61.26
124
72.93
117
66.25
1,731
81.47
1,640
65.74
3,700
80.16
3,664
Hydro Gas 2
Geothermal (consolidated)
Geothermal (equity accounted)
3
Total
0.92
LWAP/GWAP Gas Purchases
1.02
0.99
1.04
$/GJ
PJ
$/GJ
PJ
$/GJ
PJ
$/GJ
PJ
Retail purchases
9.16
0.21
8.91
0.21
8.93
0.61
8.74
0.61
Generation purchases
9.16
0.54
6.95
0.88
8.87
1.80
8.11
2.84
4
Carbon Emissions (‘000 tonnes CO2e)
104
127
1.
VWAP is volume weighted average energy only price sold to PFVV customers after lines, metering and fees
2.
Includes our share of Nga Awa Purua generation
3.
Tuaropaki Power Company (Mokai) equity share
4.
Prices exclude fixed transmission charges
255
328
Five year history of operating statistics in Excel
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
02
MARKET DATA
ELECTRICITY GENERATION BY COMPANY FOR THE THREE MONTHS ENDED 30 SEPTEMBER Mighty River Power Meridian Energy Contact Energy Genesis Energy TrustPower
18%
28%
23%
19%
6%
6%
18%
26%
23%
20%
7%
6%
Other
Financial Year Q1 2012
Financial Year Q1 2013
Source: Electricity Authority Centralised Dataset
SHARE OF ELECTRICITY SALES (GWh) FOR THE SIX MONTHS ENDED 31 DECEMBER
Mighty River Power Other
18%
82%
20%
80%
Financial Year H1 12
Financial Year H1 13
Source: Mighty River Power Purchases and Transpower Information Exchange
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
03
OTAHUHU WHOLESALE PRICE AND NATIONAL HYDRO STORAGE LEVELS National storage average FY2013 storage Rolling 12 month average Otahuhu electricity price 3500
92 90
3000
88 2500
84
1500
82
GWh
2000
$/MWh
86
80 1000 78 500
0 01 Jul
76 74 01 Aug
01 Sep
01 Oct
01 Nov
01 Dec
TAUPO STORAGE Average since 1999 FY2013 FY2012
500 450 400 350
GWh
300 250 200 150 100 50 0 01 08 15 22 29 05 12 19 26 02 09 16 23 30 07 14 21 28 04 11 18 25 02 09 16 23 30 Jul Jul Jul Jul Jul Aug Aug Aug Aug Sep Sep Sep Sep Sep Oct Oct Oct Oct Nov Nov Nov Nov Dec Dec Dec Dec Dec
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
04
OTAHUHU ASX FUTURES SETTLEMENT PRICE As at 31 December 2011 As at 30 June 2012 As at 30 September 2012 As at 31 December 2012 100 $88.66 90
$88.23
$87.98 $83.54
$83.36
$86.03 $78.76
$78.49
80 $69.68
$74.09
$71.13
$70.22
70
$/MWh
60 50 40 30 20 10 0 FY13
FY14
FY15
Financial Year
BENMORE ASX FUTURES SETTLEMENT PRICE As at 31 December 2011 As at 30 June 2012 As at 30 September 2012 As at 31 December 2012 120
$96.69
100
$91.86 $90.86
$90.33 $90.46
$86.60
$84.09
$83.05 $74.38
80
$72.61
$/MWh
$66.53 $57.69
60
40
20
0 FY13
FY14
FY15
Financial Year
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
05
NATIONAL CONSUMPTION National consumption Tiwai Point Aluminium Smelter consumption 12,000 1,373
1,345
10,000
1,345
1,202
1,204
1,345
1,367
1,314
1,231
1,303
GWh
8,000
6,000 9,447 4,000
8,458
7,970
Q2 11
Q3 11
8,619
9,467 8,199
7,946
Q2 12
Q3 12
8,834
9,350
Q4 12
Q1 13
8,363
2,000
0 Q1 11
Q4 11
Q1 12
Q2 13
Financial Year Source: Transpower Information Exchange
NATIONAL CLIMATE SUMMARY
Financial Year
Q1
Q2
Q3
Q4
2013
12.3° C
16.5° C
n/a
n/a
2012
11.5° C
16.6° C
18.9° C
14.0° C
2011
12.2° C
17.1° C
20.2° C
15.1° C
Historical Average (since 1999)
12.0° C
16.3° C
19.6° C
14.3° C
Source: NIWA
MONTHLY TOTAL CONSUMER RETAIL SWITCHING (ICPS) ICP Retail Switching % Churn 60,000
25%
50,000
20%
40,000 % Churn
ICPs
15% 30,000 10% 20,000
5%
10,000
0
0% 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
Source: Electricity Authority
MIGHTY RIVER POWER QUARTERLY OPERATIONAL UPDATE
06