New Zealand energy storage power price

Will Rankine power supply increase wholesale electricity prices in New Zealand?

Concept Consulting’s modelling shows that without thermal generation from the Rankine units as part of New Zealand’s energy storage solution, wholesale electricity prices would likely be 60% higher in the short-term (the next two-to-three years) and 11% higher in the long-term (ten+ years).

Why should New Zealand increase electricity production?

Increasing electricity production will also enable the decarbonisation of the economy – which is needed to meet New Zealand’s climate goals. Despite the building of more renewable generation plants, future prices 1 for winter 2024, 2025 and 2026 remain high (see figure 1).

Why are New Zealand's energy prices so low?

So as more wind and solar capacity is installed in New Zealand, it is likely that energy will be spilled resulting in low prices more often. This may be from hydro-electric dams, but also from wind and solar when there is enough energy to meet demand.

Where does New Zealand's energy come from?

According to official statistics, about 40% of New Zealand’s primary energy comes from renewable sources including geothermal and hydroelectric, which is the third highest among members of the Organisation for Economic Co-operation and Development, after Norway and Iceland. That equates to about 82% renewables for electricity generation.

Does New Zealand have water storage?

Despite New Zealand’s significant hydroelectric capacity, our water storage is limited, usually providing only six weeks of coverage, and often dropping below 30 days during winter. To address this, natural gas and coal are used to manage water storage and provide a top up to meet energy demand.

What type of electricity is used in New Zealand?

The New Zealand Electricity market relies heavily on hydroelectricity, which accounts for approximately 60% of total generation in most years. This is supplemented by other baseload generation sources that are available 24/7, including geothermal, natural gas and coal.