“I can’t imagine the amount of stress and upheaval for all the families and communities that are being impacted by the closure of these mills,” says Octopus Energy Chief Operating Officer Margaret Cooney.

“Even though spot prices have come down in the past two weeks, contract prices used by industry are double what they were pre 2018.

“We have been experiencing sustained high prices in New Zealand for almost 6 years. The way forward is not to simply hope for more rain in our lakes, or to import LNG. This is simply not enough to address the underlying challenge of continuing high prices.

“The Electricity Authority has been warned for years by industry and exporters that market arrangements have made electricity uncompetitive and prices too high for our productive sector.

“It is absolutely essential that the current review into the electricity market provides real action rather than deferring change.

New Zealand urgently needs more competition and regulatory change to support better competition and investment in generation,” says Margaret Cooney.

Note: 

Please see Fonterra’s submission to the Electricity Authority:

“The market settings in this regard are now effectively broken, with larger incumbent players stifling both new generation via consent sitting or pricing under new builds, and retail competition by being able to subsidise their retail divisions.

The effect is that industrial, commercial and retail users of electricity are paying more than they otherwise should be. For exporters, this is impacting on the international competitiveness, particularly as New Zealand is much further from consumer markets. It is also slowing the electrification of New Zealand’s economy."

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