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Power Grid Set to Face Challenges: Here's What You Need to Know to Keep Your Home Warm this Winter

The summer season in New Zealand has been quite eventful, with record-breaking rainfall making its mark on our beautiful landscapes. Now, as we transition into the cooler months, the impact of this rainfall is still evident in our hydro lakes. They are currently at unprecedented levels, setting the stage for what some power companies predict will be the most renewable winter yet. However, this doesn't mean that our electricity grid won't face challenges along the way.























One of the hydro lakes basking in its glory is Lake Pukaki, located in the magnificent Mackenzie Basin. This lake, among others, is brimming with water due to the remarkable amount of rainfall we experienced during summer. "They're at record high levels going into winter," shared Alison Andrew, the CEO of Transpower.


The surplus water in our system provides us with an abundance of renewable energy sources. "This winter I believe will be one of our most renewable winters yet in terms of our electricity generation," commented Chris Ewers, the general manager wholesale at Meridian Energy. With ample water in our hydro lakes, combined with our geothermal resources and wind power, New Zealand is well-positioned to have a winter with lower power prices.




However, it's important to note that while power prices may decrease, households may not immediately feel the impact. Ewers clarified, "For most residential households out there, their prices are fixed, so this will have no impact on the price they pay during the winter."


Although our country boasts significant hydro generation capabilities, the absence of thermal plants can pose challenges. Thermal plants require up to 24 hours to warm up, making them less suitable for quick electricity demands. This becomes problematic on days when we all urgently need electricity. In fact, our grid has experienced five power emergencies in the past two years.


To manage such uncertainties, the system maintains a residual capacity. This allows for extra demand during peak periods or when wind generation declines. However, without thermal plants, this backup capacity becomes limited. "If you don't have that thermal plant, you can't call on that," explained Andrew.


With the increasing electrification of New Zealand and the subsequent rise in peak demand, the grid faces additional pressure. Ewers highlighted, "From a wholesale price point of view, we see large periods of low prices except for when we do get into peak demand periods, typically between 5pm to 7pm at night, and then we see prices lift, which requires more generation."



To address this issue, the government is currently exploring options like the Lake Onslow pumped hydro scheme, which would utilize a backup battery system. Such innovations could provide the necessary generation capacity during times of high demand.


As New Zealand transitions into an El Niño climate pattern, we can expect colder winters and drier temperatures. In light of this, Andrew assured, "We are working really hard to make sure we don't have power outages going into winter." And indeed, we will need a reliable supply of electricity to keep our homes warm during the upcoming season.


Is There Cause for Alarm?


New Zealand's hydro lakes are currently at record levels due to the summer rainfall, setting the stage for a potentially renewable winter. While this brings lower power prices, households may not immediately notice the difference. The absence of thermal plants poses challenges during peak demand periods, necessitating innovative solutions for backup generation. With our changing climate, it becomes increasingly crucial to ensure a reliable power supply as we prepare to warm our homes in the colder months ahead.


We Can Help You Find a Reliable Power Company and Shave 5-20% Off Your Power Bills This Winter


Manage My Bills is an independent Energy Management company that specialises in understanding the energy market conditions. We understand the changing market and the right time to act. It’s always about the timing.


We also use our strong negotiation skills and bulk buying capacity to get the best price for your business. The most important thing is that we are Independent. This means that we do not get paid by ANY power or gas company, hence we have no reason to be biased towards anyone.


You are our customer, and we work for you. Hence, whoever gives us the best price for your business, we will recommend that to you. We are not a sales company; hence we will not leave you as soon as you sign with us. This is where our work starts. We audit your bills every month to ensure there are no billing errors, the rates match what have been offered to you, and price optimisations.


Price reviews: Even if you are in a contract with our recommended provider, it does not stop us from looking for a better rate for you. We do annual reviews and if there is a new company offering better rates than your current (>5% savings), we will recommend that to you. Of course, we will take all the cancellation costs into consideration.


For all this, we only charge a small monthly fee that always comes from the savings that we achieve for your home or business. If we can’t save you money, we don’t propose you to change at all.


So don’t get shocked when you see a price change letter next month, just get in touch with us and we will evaluate that for you.





Reference article: https://www.newshub.co.nz/home/new-zealand/2023/06/new-zealand-s-hydro-lakes-at-record-levels-heading-into-winter-but-challenges-remain.html

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