GNE - Genesis Energy

[fish]

What REALLY matters is the price you sell something for LESS the total cost of supplying it.

So just to ask a (difficult) simple question: How much of what Genesis sell is at a price related to the spot price of electricity?

Best Wishes
Paper Tiger

Thanks for that question PT.
I am not privy to the commercially sensitive answer.
It varies every 1/2 hour according to the demand and prices offered by the generating companies.
I suspect you actually know more than I do.
What I do know is there is a fixed cost to start and run a generator at huntly and then a variable price according to the price of fuel and how much is burnt.
The demand for electricity is high ,the current spot price is very high.Hydrolakes are lower than average so more thermal generation is required.
Genesis have the most thermal generation which can meet this increased demand.
If fixed costs are say $50 and the market price is $75 profit is 25.If price is $200 profit is 6 times that figure.
I see the spot price is still over 200 so genesis should be creaming it.
I wish I knew the full answer to your question-anyone know the actual current figure?

[Snow Leopard]

You seem to be floundering and apologies for carping on but you are missing the point.

Genesis is a Gentailer: Generator & Retailer.

A lot of what

Genesis the Generator

sells is [effectively] sold to

Genesis the Retailer

and they sell it to their customers (at say $0.26KWh [$260 MWh]) no matter what the spot price. So that cancels out.

Best Wishes
Paper Tiger

PS. It can get complicated if you want it too

[Traderx]

You seem to be floundering and apologies for carping on but you are missing the point.

Genesis is a Gentailer: Generator & Retailer.

A lot of what

Genesis the Generator

sells is [effectively] sold to

Genesis the Retailer

and they sell it to their customers (at say $0.26KWh [$260 MWh]) no matter what the spot price. So that cancels out.




Best Wishes
Paper Tiger

PS. It can get complicated if you want it too

You are very correct, however GNE along with CEN have the most flex in their portfolio to generate extra in high spot price I.e be long exposed to spot. Prices averaged 200 ish today and GNE will be trading off vol vs margin to good effect at these levels, well above srmc of the thermal plants.

Rule of thumb is GNE does well in low storage inflows scenario.

[Jantar]

..... PS. It can get complicated if you want it too

LOL. Much more complicated than even you can imagine. Of that $0.26 per kWh, over half goes to Transpower and the network (lines) company. Their actual transfer price from Genesis the Retailer to Genesis The Generator is likely to be in the range of $0.07 to $0.09 per kWh and the actual energy cost that Genesis the Retailer receives from the retail customer would be around $0.12 per kWh.

I don't know all of Genesis' conection charges, but I do know that their Tekapo station pays almost $0.09 per kWh direct to Transpower for HVDC charges. Its actually a veriable charge based on their peak injection, but South Island wide works out to close to $8.90 per MWh.

[horus1]

Distribution charges are 23%, and transmission charges are 7.4%.This is as quoted by the Commerce Commission.
Your note is an example of the misinformation put out by generator/retailers to cover up the excessive margins being charged to small customers

[Jantar]

Distribution charges are 23%, and transmission charges are 7.4%.This is as quoted by the Commerce Commission.
Your note is an example of the misinformation put out by generator/retailers to cover up the excessive margins being charged to small customers

Oh dear. I have the exact data available to me and it is NOT mis-information. Could you please supply a link to that claim by the Commerce Commision?

[Beagle]

You are very correct, however GNE along with CEN have the most flex in their portfolio to generate extra in high spot price I.e be long exposed to spot. Prices averaged 200 ish today and GNE will be trading off vol vs margin to good effect at these levels, well above srmc of the thermal plants.
Rule of thumb is GNE does well in low storage inflows scenario.

There's been a lot of dry summers in recent years...this one looks like a real stunner for GEN to make super profits from generation.

[Bobdn]

All this is far too complicated for me. I think I might be the Forest Gump of investing. I do understand that GNE is paying a net dividend of 7% and that's a lot more than my ANZ serious saver pays.

[bull....]

I do understand that GNE is paying a net dividend of 7% and that's a lot more than my ANZ serious saver pays.

thats the main thing which will cause the share price to keep going up - with term deposit rates set to fall it looks even more attractive

[horus1]

Look on their website under distribution regulation.