Updated 11th March 2019
Good news from the Price Review
A quick note for those of you who don’t know - the Electricity Price Review panel released their first options paper a fortnight ago. It was a doozy! They’ve made recommendations to: prohibit prompt payment discounts; prohibit winback offers; and boost the consumer voice. All the things we’ve been saying for a while now, in other words!
They also recommended a couple of things that line up directly with what we argued in our Undesirable Trading Situation claim to the EA: that rules on disclosing wholesale market information need to be toughened and that the gentailers market-making obligations should be mandatory. Head over to our blog to find out more!
Word's out on the UTS
On the subject of the Undesirable Trading Situation, the Electricity Authority has ruled that wholesale market conditions from September 14 to early November wasn’t an undesirable trading situation. There’s no two ways about it, we’re disappointed. That said (and somewhat ironically), the EA did find a case of ‘asymmetrical information’ - where one market participant, in this case Genesis, trades based on different information to everyone else. The EA has also referred some actions taken during the period to the Australian Securities and Investments Commission. They’re the big guns when it comes to trading issues and we reckon that speaks for itself. Want to know more? There’s a blog for that too!
The Pohokura effect
Gas, or lack thereof, remains one of the key drivers of higher spot prices at the moment. The initial 2 week Pohokura gas field outage has ended with OMV completing the first phase of maintenance work aimed to optimise production from this large gas field. A further 18 days of outages are expected throughout March and April. The exact start and end times here are subject to a number of variables, including the weather.
High temperatures continue
Much like the previous market update, an extended run of hot and dry weather during February kept demand higher than normal for this time of year largely off the back of South Island irrigation. Despite a rain event towards the end of February, national hydro storage is low at around 83% of average for this time of year.
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