New Zealand's power providers ramped up coal-fired generation during the July-September quarter, according to data from the Ministry of Business Innovation and Employment (MBIE), because of weaker hydroelectric generation.
New Zealand's energy producers generated more coal-fired power between July-September compared to the same period of last year as hydropower storage levelsslid across the country to a low of approximately 1,600GWh in August. Producers generated 884GWh of coal-fired power during the quarter, more than doubling on the year. This accounted for 8pc of the country's electricity generation during the quarter. In comparison, coal accounted for 3pc of the power mix in the same quarter a year earlier.
The country's electricity authority in July reported that New Zealand's coal stockpile was relatively low at 140,000t, but producers had used 363,513t to generate electricity by September, indicating that imports were supporting the increased demand. New Zealand's coal imports increased by more than fourfold on the year in July-September, with importers shipping over 477,379t of sub-bituminous coal into the country, according to data from the MBIE. In comparison, the country imported 240,305t of coal over the whole of 2023.
Some power providers started preparing to increase their use of coal generators early this year. New Zealand's largest utility Genesis Energy in May announced it plans to import coal into the country for the first time since 2022, following a drop in gas and hydroelectric production.
Major utility Meridian Energy reported in October that water levels at the Lake Pūkaki – New Zealand's largest hydroelectric storage lake – hovered below 91-year averages between May-August. But "all the rain [Lake Pūkaki] missed from April to August finally arrived in September," the company's general manager of wholesale, Chris Ewers, said.
New Zealand's state-owned transmission provider, Transpower, has recorded increases in hydropower storage levels since late August, limiting the need for further coal generation. Storage levels in both the North Island and South Island currently exceed January levels.
The country's appetite for coal has grown alongside a loosening of fossil fuel restrictions. New Zealand's current government decided to weaken coal mine consenting rules during its first round of planning reforms in late 2023, in an attempt to boost production. The government amended the Resource Management Act to allow miners to construct coal mines that affect wetlands, when previously mines affecting wetlands were banned.
Resources minister Shane Jones in June introduced legislation to restart offshore oil and gas exploration across the country, reversing the previous government's ban. "Natural gas is critical to keeping our lights on… especially during peak electricity demand and when generation [from intermittent sources] dips," he said.
