Highest Ever Increase In Electrical Industry Sales Shows Need For Urgent Action

Stats NZ reported earlier this month that industry sales increased by $2.1 billion (36 percent) in the June 2024 quarter, compared with last year. This is the highest yearly increase since the series began in 2016. 

“Make no mistake, an increase of this magnitude should not be swept under the rug and ignored. This is additional to the bill paid by New Zealand to the energy sector. There is currently an energy crisis in New Zealand,” says Octopus Energy NZ Chief Operating Officer Margaret Cooney.

“While spot prices move up and down, electricity futures prices have remained stubbornly high for the past five years and continue to do so into the future, this cost burden flows through to New Zealand businesses and households.

“We’ve heard many excuses, but the root cause of this situation is a lack of investment in new generation to meet the needs of New Zealanders, this wouldn’t be happening if competition was working well. 

“Inaction has the potential to tip the New Zealand economy. The market has been sending a signal to big New Zealand businesses to shut. The crunch of high prices is causing valuable industrial businesses to up and leave our shores.

“This is happening because New Zealand’s electricity sector has for too long been complacent with the status quo.

“We will continue to face these challenges unless there are changes to the regulatory settings to create a fair and transparent electricity market for the benefit of industry and consumers,” says Margaret Cooney. 

Note:

https://www.asxenergy.com.au/futures_nz

The red line in the chart below is the price for futures contracts bought more than a year in advance.

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