- Hon Simon Watts
- Hon Shane Jones
Energy Minister Simon Watts and Associate Energy Minister Shane Jones have welcomed an agreement by Genesis, Mercury, Meridian, and Contact to establish a strategic energy reserve, which will boost energy security and support affordable energy prices.
"New Zealand needs reliable and stable power so our households and businesses can keep their lights on, even when the wind isn't blowing, the sun isn't shining, and our hydro lakes are low," Mr Watts says.
"Last year's dry winter highlighted vulnerabilities in our energy system with a shortage of fuel and generation led to high prices and unacceptable pressure on Kiwi industries, businesses, and households.
"This could have been avoided if New Zealand had enough fuel for electricity generation to meet our energy needs. Actions by the previous government, including a ban on new gas exploration and a drive to immediately achieve 100 percent renewable electricity, combined with disappointing drilling results from our gas fields, have left us in this difficult situation.
"I have been extremely clear with power generators that the Government expects them to deliver additional supply so we can reduce the risk of winter power shortages during periods of low lake levels. This will reduce the need for significant commercial power price spikes and the need for businesses to reduce their power use."
Genesis, Mercury, Meridian, and Contact have jointly agreed to a 10-year fuel stockpile, building resilience in the market to ensure consumers have access to fuel even when lake levels are low.
"This announcement is a positive step to show the power generators are responding. It will act as an important buffer during periods of high electricity demand in winter and when renewable generation is low," Mr Jones says.
"While this is positive news, there is still more to do to ensure New Zealand does not see a repeat of last winter."
The Coalition Government is taking strong actions to further strengthen New Zealand's energy system. These are focused on:
- Ensuring the security of gas and fuel supplies.
- Supporting investment certainty and removing regulatory barriers through Fast-track and RMA reforms.
- Strengthening market competition via the work of the Energy Competition Task Force.
"All of this work is critical to easing the cost of living for Kiwis, ensuring the security and affordability of our energy system, and ultimately removing a significant barrier to economic growth," Mr Watts says.
