Contact Energy - CEN Chart

[troyvdh]

Jantar...imho nothing wrong with a healthy amount of paranoia...for me selling a few at 730 was ...like I said at the time my neck just got so sore looking straight up and thought this is nuts.cheers troy

[PSE]

Was the poor result due to issues at te mihi?. The corporatised industry often seems to forget about the power stations as not being important LOL.
This is what happens when you lay off all the good engineers and desperately overload the remaining handful profits will accrue to shareholders but things keep blowing up (literally). Lots of jobs in Wellington shifting paper, but the last significant apprentice intake was by then NZED. The captive consumer will continue to pay for the inefficiencies, like two 57% efficient CCGTs sitting idle while genesis runs 250MW of 30% efficient coal and destroys the climate.
From an investment perspective Contact has been quite savvy moving out of baseload thermal, they will not suffer much if tiwai shuts down and won't need any big capital spend soon.

[Snoopy]

Could get even worse for the big power co's in the future..
"Tesla’s next innovation could take you off the electric grid. The electric car manufacturer is planning to unveil a new lithium-ion battery pack that homeowners could buy to store and supply their own energy. “We have the design done, and it should start going into production in about six months or so,” Musk said.
http://time.com/3707137/tesla-house-battery/

The above article is all about Elon Musk bulking up potential demand from his new mega battery factory, all in the aim of reducing battery pack cost for his (and others) electric cars. I don't believe utilising lithium iron batteries as a pre-charged power source for homes is a threat to power company earnings. The existing power companies might equally gain by adopting this technology themselves. You could equally well argue that with the increase of the electric car population that cheaper battery packs will allow, could mean the traditional generators will be able to sell more power to consumers at what are normally low power demand times. I know that both Joan Withers (Chair) and Fraser Whineray (CEO) of Mighty River Power are already sold on just such a concept.

SNOOPY

[Harvey Specter]

I know that both Joan Withers (Chair) and Fraser Whineray (CEO) of Mighty River Power are already sold on just such a concept.

Not just gentailers but network companies too. For remote locations, rather than upgrading lines to cope with high demand that is just 1 hour a day, they could locate battery packs close to the demand to peak-shave power demand on their network.

Household batteries are also the perfect use for old battery packs. As they start holding less than (say) 80% original capacity, they could be installed into the home (where the full capacity isn't strictly needed) and a new, higher capacity battery installed in the car. In 5 years or so, all tesla users will want a replacement battery pack.

[babymonster]

never mind, i did miss out the 7.30... being too greedy.. not i will have to wait for the next round..

[PSE]

Power companies will benefit from increased demand from electric cars. At 30c a kilowatt hour residential solar is not competitive with geothermal at 9c a kilowatt hr.
Doesn't matter what the losers with their snout in the trough (withers et all) think, you could sack them all tommorrow and the run the plants with a merit order (cheapest first). As we used to do.
Reality is that peak electricity demand in NZ is in winter when solar generation is at a minimum, so even if solar was to become competitive (who can say) NZ will still need an electricity grid and power companies.
We seem to be stuck with the market ideology despite the fact that the idea was flawed from the start and has proven massively wasteful.

[Jantar]

Power companies will benefit from increased demand from electric cars. At 30c a kilowatt hour residential solar is not competitive with geothermal at 9c a kilowatt hr.
Doesn't matter what the losers with their snout in the trough (withers et all) think, you could sack them all tommorrow and the run the plants with a merit order (cheapest first). As we used to do.
Reality is that peak electricity demand in NZ is in winter when solar generation is at a minimum, so even if solar was to become competitive (who can say) NZ will still need an electricity grid and power companies.
We seem to be stuck with the market ideology despite the fact that the idea was flawed from the start and has proven massively wasteful.

In a way we do still have a merit order, but now the companies set their own merit through the offer price.

The basic idea of a market was a good one, but unfortuantely for New Zealand, the laws of physics and the laws of economics do not match. It was the accounants who won out over the engineers and operators.

[PSE]

Got a lot of time for you Jantar and traders in general (nothing personal) but the fact of the matter is that the electricity market is a natural monopoly - you can't build a competing electricity grid so the market is very much an artificial one.
Agree each company has a merit order by which the gentailers use their own assets efficiently. Unfortunately this often leads to inefficient overall outcomes, as per the huntly coal running ccgt off situation that is presently going on.
Mothballing CCGTs while Todd energy builds new peakers this is a huge waste. I don't know the mechanics of the market but outcomes like these are plain to see.
Frequency keeping with a CCGT, thats not as efficient as hydro. Gaming of the reserves market, yall have made hundreds of millions there.. genesis ramping down one station then ramping up another to get constrained off payments. I don't blame you this is your job to create efficient outcomes for your companies, on the other hand we shouldn't pretend these outcomes are the most efficient overall.

[PSE]

There should be a balance between traders, accountants and engineers aye jantar - I don't want to rule the world and am sure this would not be an efficient outcome either

[Jantar]

......- you can't build a competing electricity grid so the market is very much an artificial one.
Agree each company has a merit order by which the gentailers use their own assets efficiently. Unfortunately this often leads to inefficient overall outcomes, as per the huntly coal running ccgt off situation that is presently going on.......

When I was a System Controller we used to run the system as if it was a competitive market, with the merit order setting the prices and the hydrology and fuel availability setting the limits on how much each station would generate in a day. There would be times that we would have dearer generation running while cheaper was sut down, but that was to smooth the transitions over time periods, maintain efficiency and prevent the current ludicrous situation where dispatch instructions happen every 5 minutes and cause plant to run inefficiently.

I believe Contact are running plant the way they are to avoid wasting fuel while running inefficiently.