Written By:
- Date published:
2:00 pm, September 24th, 2026 - No comments
Categories: act, Economy, election 2026, national, nz first -
Tags: electricity, electricity market, electricity prices, gas
National had proposed building a liquefied natural gas (LNG) terminal at Port Taranaki. Ostensibly this was to provide dry year support for the electricity generators to burn gas to run turbines whenever New Zealand had a dry year that caused hydro dams to be short of water. National were planning to have this signed up before the election. Act and NZ First appear to have quashed that. I guess that the level of outrage of consumers to being taxed yet again by the National government for their piss-poor 1990s energy management broke through.
There have been various iterations of how this emergency backup facility was meant to be paid for. But mostly it will, and has been, landing largely on the bills of residential consumers directly or indirectly. The problem is that it looks like a expensive short term band aid for decades of poor capacity management by the generators and their shareholders.
The biggest shareholder is the government, and this has been quite apparent in how the electricity ‘market’ operates.
The highest cost generation sets the prices for all generation within a time period – which provides the perverse incentive for generators to prioritise generating using the most costly. Typically fossil fuel generation.
The ‘market’ also has resulted almost complete lack of investment in new generating capacity relative to population or GDP.
While there have been new generating plant put into place, most of it has simply replaced plant that has had to retire. There is an impressive list somewhere on wikipedia of previously proposed generation projects over the last few decades, almost all of which were not proceeded with.
The ‘Bradford’ reforms also resulted in the grid that transports electricity being chronically under funded over the past decades. This is most apparent in the rapid rise of line rates recently which appear to have been mostly influenced by having to replace the Cook Strait HVDC lines that transport both ways between power between the North and South islands. This was a foreseeable cost, like most of the the electricity grid, however it appears that no money was accrued beforehand to do the replacement.
Personally, as a consumer, as soon as possible, I’m currently planning on moving off the our flaky poorly maintained grid as far as possible if not entirely. I’m tired of paying far too much for electricity. Not to mention having to maintain UPS batteries to power my comms and computers anyway because the grid and electricity lines companies tend to be unreliable.
Moreover, I can’t see much point in pushing generated power into the grid bearing in mind the exceptionally low returns and the operational habits of companies providing that service in Australia. Adding more batteries over time seems like a more economic proposition as they steadily redice in price..
I also don’t want to pay for gas to be burnt to provide better profits for gentailers, as they under-invest, over charge, and provide a service not for my benefit – but for their shareholders.
We’re renting at present in Invercargill for family reasons, having now sold our Auckland apartment. Apartments are really hard to make self-power generation. Next house (when we decide where it will be) will be getting a capital improvement designed to not pay a tax for National and other shareholders of our power ‘market’. Nor to burn gas.
