Contact Energy - CEN Chart

[limmy]

CEN pays divvies steadily year after year. What more can we ask for ?

[turnip]

b/ If the Clyde dam was forced to release water to fill Lake Roxburgh when prices were low (Prof Beardsly's scenario), then doesn't that mean that water will be running through the Clyde dam when prices are low? That surely is not what Contact Energy wants?

It might not be what they want, but Contact's CEO has described the Clutha as NZ's biggest run-of-river scheme, i.e. when inflows are high Contact often doesn't have much choice but to release water.

There is another problem with putting water supply into Lake Roxburgh for Onslow when the power from the Clyde dam is not needed. You are simply taking energy from one battery (Lake Dunstan) and putting it into another (Lake Onslow), with no net energy (or price?) gain.

It is being taken it from a lower elevation to a higher elevation, so it increases the potential energy of the water, and the power to do this could come from the North Island, e.g. from Contact's big geothermal plants or Mercury's wind farms that continue to generate even when prices are low. If the massive tranbsmission upgrade needed to get Onslow's power to where it is neede in Auckland occurs then it should be able to be used the other way to transmit the North Island's surplus geothermal and wind generation down to Onslow too.

[LaserEyeKiwi]

From the Stuff Article:
"Waikato University associate professor Earl Bardsley, who came up with the idea of building the pumped hydro scheme, said it would be in Contact Energy’s interest to have water pumped from Lake Roxburgh during times of plentiful power supply and then released back to the lake when power generation from Lake Onslow was needed."

“With respect to a tunnel connecting to Lake Roxburgh, the point seems to be missed that the pumped water is later returned to Lake Roxburgh,” he said.

“Contact Energy would presumably be pleased that some of the water in Lake Roxburgh is shifted to be stored in Lake Onslow during times of low prices, then returned later to Lake Roxburgh at times of higher prices, thus increasing income from the Roxburgh power station.”

To clear up any naming and geographic confusion, Lake Dunstan feeds the Clyde dam. These are both upstream of Lake Roxburgh that feeds the Roxburgh dam. Both dams are owned and operated by Contact Energy.

I don't follow Prof. Earl Beardsly's argument.

a/ I get what he is saying about shifting water up to Onslow from Lake Roxburgh when prices are low. That means that water can be returned to Lake Roxburgh when prices are high (this bit makes sense as being positive for Contact).

But where did the water from Lake Roxburgh come from? It came upstream from the Clyde dam. And it would only benefit Contact to release extra water from the Clyde dam for Lake Roxburgh (and hence Onslow) when power prices are high.

b/ If the Clyde dam was forced to release water to fill Lake Roxburgh when prices were low (Prof Beardsly's scenario), then doesn't that mean that water will be running through the Clyde dam when prices are low? That surely is not what Contact Energy wants?

There is another problem with putting water supply into Lake Roxburgh for Onslow when the power from the Clyde dam is not needed. You are simply taking energy from one battery (Lake Dunstan) and putting it into another (Lake Onslow), with no net energy (or price?) gain.

SNOOPY

I would think it makes the most sense when the dams are needing to spill water - if Onslow was able to pump that instead it would be very beneficial to contact. Also presumably there dams would be the source of power for when Onslow is being filled (the electricity needing to power the pumps) - so contact also picks up a large new customer that only buys power off-peak.

In the end - the numbers/economics probably end up being that if Onslow does get built then it makes the most sense for the entity operating Onslow to also be the same one that operates Clyde & Roxburgh Dams - no idea how that deal would be structured.

[RTM]

CEN pays divvies steadily year after year. What more can we ask for ?

Well...I would like modest capital growth as well. To more or less match inflation. Which I have had.
Have held since 2014 topping up occassionaly when price has dropped.
5.5% of my portfolio. Looking forward to dividend hitting bank account.

[Snoopy]

It is being taken it from a lower elevation to a higher elevation, so it increases the potential energy of the water, and the power to do this could come from the North Island, e.g. from Contact's big geothermal plants or Mercury's wind farms that continue to generate even when prices are low. If the massive transmission upgrade needed to get Onslow's power to where it is needed in Auckland occurs then it should be able to be used the other way to transmit the North Island's surplus geothermal and wind generation down to Onslow too.

Yes that is true. But the potential energy gained by having water elevated to a high plateau lake will be exactly lost by the electrical energy needed to pump it there. And that is a best case scenario. There will be friction losses in the piping and the electric motors that power the project pumps to make sure that conversion of energy 'from bottom to top' falls short of 100%. So the whole Onslow concept only makes sense when:

a/ The power price fluctuates with time AND SO
b/ It becomes possible to take power from a generation site- where there is no alternative use of that power at that time (i.e. it has a low instantaneous 'market value') - so that you can use what would otherwise be 'wasted energy' to 'pump water up hill'.

The problem I see with using hydro-electricity to do this is that there is always an alternative use. Just keep the water behind the dam until it is needed! That way you get to harvest all of the potential energy contained in that water, without losing energy to extra pumping and piping inefficiencies.

That means the best solution for 'pumped hydro' looks to be bringing surplus power down from the North Island to do the pumping. It wouldn't be geothermal power, because geothermal energy stations tend to be best suited to base load. It wouldn't be thermal energy from Huntly, because pumping water uphill using thermal energy to use in a situation that would otherwise require thermal energy to balance supply would not save any greenhouse gases being emitted. That just leaves wind power. So ideally we would want a situation with a solid breeze blowing over the north while there is an excess of water in the Clutha catchment, which probably means in the Spring and the Summer. How often would those ideal conditions line up? I don't know.

It might not be what they want, but Contact's CEO has described the Clutha as NZ's biggest run-of-river scheme, i.e. when inflows are high Contact often doesn't have much choice but to release water.

I would think it makes the most sense when the dams are needing to spill water - if Onslow was able to pump that instead it would be very beneficial to Contact.

The above two comments suggest that there are short sharp time periods where otherwise spilled water could be pumped up to Onslow to save what otherwise would be otherwise be 'wasted water'. The idea of pumping the excess of a raging torrent up a hill doesn't sound practical to me. Yes you could in theory put in sufficient pumping and piping capacity to do it. But that sounds like an enormous incremental capital cost over and above what would normally be required to keep Onslow full.

Also presumably there dams would be the source of power for when Onslow is being filled (the electricity needing to power the pumps) - so Contact also picks up a large new customer that only buys power off-peak.

Doesn't sound like a good deal for Contact to me, for reasons outlined in the first paragraph of my reply.

In the end - the numbers/economics probably end up being that if Onslow does get built then it makes the most sense for the entity operating Onslow to also be the same one that operates Clyde & Roxburgh Dams - no idea how that deal would be structured.

In an engineering sense, servicing Onslow would be no more difficult that servicing Clyde and Roxburgh dams. So the engineering capability should already exist locally, whether those people be contractors or direct Contact Energy employees. But in an economic system wide electricity market sense, the purpose of Onslow would be to suppress peak pricing. That would not go down well with Contact when pre-Onslow they could bring another turbine from Clyde into service to take advantage of rogue peak pricing.

SNOOPY

[alokdhir]

http://nzx-prod-s7fsd7f98s.s3-websit...941/376502.pdf

Very bullish projections for FY 25 ....35 % growth in EBITAF !!

Jarden says Divvy can grow to excess of 50 Cents ...Not just a safe utility but a growth stock too

Should rise further as market pays more attention to future plans and projections

https://www.nzherald.co.nz/business/...DRVQS7J4M7SCI/

[BlackPeter]

...

The above two comments suggest that there are short sharp time periods where otherwise spilled water could be pumped up to Onslow to save what otherwise would be otherwise be 'wasted water'. The idea of pumping the excess of a raging torrent up a hill doesn't sound practical to me. Yes you could in theory put in sufficient pumping and piping capacity to do it. But that sounds like an enormous incremental capital cost over and above what would normally be required to keep Onslow full.

SNOOPY

Not quite sure I understand that comment. The first hydro storage lakes have been implemented (in other parts of the world) basically at the same time they started to generate and distribute electric power.

The Walchenseekraftwerk in Upper Bavaria (basically two with pipes connected lakes and a generator / pump inbetween) works efficiently, effectively and economically for nearly one century (started in 1924) ... and the work to pump the water uphill is done by the very generators they use to generate the power when the water flows downhill. Just turn the generator into a pump by connecting it to power (instead of harvesting power as you do from a generator). No additional equipment required ... you just need an ordinary hydroelectric plant plus some storage space at the top of the power station.

https://de.wikipedia.org/wiki/Walchenseekraftwerk

[see weed]

Surely over $ 8 before going ex as we discussed before ...well done mate on your safe money making strategy ...

Thank you. Started topping up on 14/6/22 but didn't quite get to my target of 50k shares but the ones purchased are up $27k as i type and looking forward to $8.3k div. Next cab off STU hoping.

[Snoopy]

Not quite sure I understand that comment. The first hydro storage lakes have been implemented (in other parts of the world) basically at the same time they started to generate and distribute electric power.

I wasn't commenting on the technical feasibility of pumping water up hill using hydro energy. I was commenting on the economic feasibility of doing so 'all at once' during flood conditions.

The Walchenseekraftwerk in Upper Bavaria (basically two with pipes connected lakes and a generator / pump inbetween) works efficiently, effectively and economically for nearly one century (started in 1924) ... and the work to pump the water uphill is done by the very generators they use to generate the power when the water flows downhill. Just turn the generator into a pump by connecting it to power (instead of harvesting power as you do from a generator). No additional equipment required ... you just need an ordinary hydroelectric plant plus some storage space at the top of the power station.

https://de.wikipedia.org/wiki/Walchenseekraftwerk

Always interested to hear how other countries do this, and it looks like in Bavaria they have nearly 100 years experience in 'pumped hydro energy'. Interesting reference - thanks. I don't speak German but used 'google translate' to dip into your reference. Please forgive me if I have got the wrong gist of the article because of this, but there are a couple of points to note.

1/ "The Walchensee power plant uses hydropower to generate electricity at a natural height difference of 201 m between the Walchensee (801 m above sea level), which acts as the "upper reservoir" and the "lower reservoir" Kochelsee (600 m above sea level). During the operation of the power plant, the water level of the Walchensee can be lowered by around 6 m, which corresponds to an available storage space of 110 million m³. It is therefore a storage power plant, but not a pumped storage power plant, since no water is pumped back into the Walchensee. It was originally built for the general power supply and is now mainly used as a peak load power plant and – depending on the water supply – also as a medium load power plant. reservoirs and tributaries."

IOW while the Walchensee uses pumped input from some upstream hydro developments, this is not 'pumped hydro' in the sense of what is being proposed at Onslow.

2/ "The natural outflow of the Walchensee near Niedernach - via the Jachen to the Isar - is blocked by a weir. In order to keep the water level of the Kochelsee as stable as possible, its outflow is regulated in a canal near Kochel. In order to protect the flat Loisach Valley and Wolfratshausen from flooding caused by the water from the power plant,"

So 'Walchensee' has flooding issues as well. But in this case, the threat of the flooding is excessive discharge from 'Walchensee' (too much water being released at the top of the cliff). The outflow from 'Walchensee' is controlled by a weir at the top of the cliff and an alternative discharge path at 'Kochelsee' at the bottom of the cliff. This is very different to the Clutha River situation where the flooding is happening at the bottom of the cliff, terhe is no alternative route for excess water and the 'proposed fix' is to pump the rage of the torrent uphill, with no control on the amount of water that is required to be pumped uphill.

So while this is impressive engineering from 100 years ago in Germany, and is still well suited to serve that market today, I don't see many lessons here we can apply to Onslow on the Clutha River in New Zealand in 2022.

SNOOPY

[BlackPeter]

I wasn't commenting on the technical feasibility of pumping water up hill using hydro energy. I was commenting on the economic feasibility of doing so 'all at once' during flood conditions.



Always interested to hear how other countries do this, and it looks like in Bavaria they have nearly 100 years experience in 'pumped hydro energy'. Interesting reference - thanks. I don't speak German but used 'google translate' to dip into your reference. Please forgive me if I have got the wrong gist of the article because of this, but there are a couple of points to note.

1/ "The Walchensee power plant uses hydropower to generate electricity at a natural height difference of 201 m between the Walchensee (801 m above sea level), which acts as the "upper reservoir" and the "lower reservoir" Kochelsee (600 m above sea level). During the operation of the power plant, the water level of the Walchensee can be lowered by around 6 m, which corresponds to an available storage space of 110 million m³. It is therefore a storage power plant, but not a pumped storage power plant, since no water is pumped back into the Walchensee. It was originally built for the general power supply and is now mainly used as a peak load power plant and – depending on the water supply – also as a medium load power plant. reservoirs and tributaries."

IOW while the Walchensee uses pumped input from some upstream hydro developments, this is not 'pumped hydro' in the sense of what is being proposed at Onslow.

2/ "The natural outflow of the Walchensee near Niedernach - via the Jachen to the Isar - is blocked by a weir. In order to keep the water level of the Kochelsee as stable as possible, its outflow is regulated in a canal near Kochel. In order to protect the flat Loisach Valley and Wolfratshausen from flooding caused by the water from the power plant,"

So 'Walchensee' has flooding issues as well. But in this case, the threat of the flooding is excessive discharge from 'Walchensee' (too much water being released at the top of the cliff). The outflow from 'Walchensee' is controlled by a weir at the top of the cliff and an alternative discharge path at 'Kochelsee' at the bottom of the cliff. This is very different to the Clutha River situation where the flooding is happening at the bottom of the cliff, terhe is no alternative route for excess water and the 'proposed fix' is to pump the rage of the torrent uphill, with no control on the amount of water that is required to be pumped uphill.

So while this is impressive engineering from 100 years ago in Germany, and is still well suited to serve that market today, I don't see many lessons here we can apply to Onslow on the Clutha River in New Zealand in 2022.

SNOOPY

Well researched - I stand corrected (assuming Wikipedia is right ... the translation is fine). The Walchenseekraftwerk is not a pumped storage hydrostation. I really should first read the links I attach instead of assuming to know what's in them, shouldn't I?

Never trust your physics teacher - he taught us 50 years ago that the Walchenseekraftwerk is a pumped storage power station, but it looks like he was wrong. Some more research shows that there was a proposal to turn it into a pumped storage hydrostation, but this was never implemented.

Anyway - there are however plenty other pumped storage power stations around we could learn from, and some of them are as well around since at least the 1930'íes (check the second table in the link below):

https://en.wikipedia.org/wiki/List_o...power_stations

Interesting however to note that many of the big ones seem to have been built in China ... maybe they are not as environmentally friendly and green as one would think and hope?