Chris Hipkins delivered his State of the Nation speech at Auckland’s Wynyard Quarter on Monday. Photo \/ NZME<\/p>\n
It estimated the presence of the terminal would reduce the dry-year risk that is currently incorporated into the price of electricity by at least $10\/MWh. The cost of the levy minus the cost of the savings was meant to result in a net saving, reducing household energy bills overall.<\/p>\n
However, not everyone is convinced, with Labour attacking the plan as a \u201cgas tax\u201d that will add the cost of a levy to energy bills without resulting in a saving. Labour leader Chris Hipkins said he would stop the terminal from being built if a contract was not signed by the time a future Labour-led Government took office.<\/p>\n
Finance Minister Nicola Willis was positive on Monday.<\/p>\n
\u201cAlready we have seen that in response to the Government\u2019s announcement about an LNG proposal to provide that reliable fuel supply, we\u2019ve seen the future pricing come down and that reflects risk being removed from the equation,\u201d she said.<\/p>\n
Willis said it would \u201ctake some time over the coming months\u201d to sign a deal to build the terminal.<\/p>\n
Genesis chief executive Malcolm Johns told Newstalk ZB\u2019s Heather du Plessis-Allan Drive that the fall in futures prices was significant \u201cin the context of where we\u2019ve been\u201d.<\/p>\n
He was less certain on whether the change was down to the LNG terminal directly, which Genesis has in the past said should only be considered as a last resort. <\/p>\n
\u201cI can\u2019t relate it [the drop in prices] to any deal. There\u2019s a lot of generation that\u2019s being built at the moment but the more fuel resilience you have, the more certainty there is in being able to generate electricity in the future,\u201d Johns said.<\/p>\n
\u201cI don\u2019t think there\u2019s a single lever or a single silver bullet,\u201d he said. <\/p>\n
Infometrics economist Gareth Kiernan said the terminal was likely to be having an effect on prices, but the influence may be overblown.<\/p>\n
\u201cWholesale spot electricity prices have been very low over the last 2-3 months, even allowing for the usual lower demand levels over summer, but I noted when looking at the 2027 futures prices recently that they were still on a par with where they were in mid-late 2024 \u2013 implying that the market still expected supply constraints to be an issue over the medium term,\u201d he said in an email.<\/p>\n
\u201cSo given that wholesale prices have eased to their lowest levels in about 16 months over the last fortnight, it seems likely that the Government\u2019s LNG announcement is having some effect on the market.<\/p>\n
\u201cHowever, I\u2019d note that the effect on 2027 prices might be a bit overblown, given that the Government themselves has said that the LNG facility \u2018could be operational as soon as 2027 or early 2028\u2019, which hardly fills me with confidence that it will be up and running by winter next year.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"The fact futures contracts for the period after the new liquefied natural gas (LNG) terminal opens have fallen…\n","protected":false},"author":2,"featured_media":300328,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[8038,60698,8831,806,17517,3269,138,9632,10712,6131,29384,1686,26095,49738,15248,21978,266,14349,185,702,53655,43019,117,111,139,69,1118,2170,10112,3333,2249,30331,223,8982,44194,19135],"class_list":{"0":"post-300327","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-natural","9":"tag-although","10":"tag-an","11":"tag-as","12":"tag-because","13":"tag-build","14":"tag-business","15":"tag-celebrates","16":"tag-claiming","17":"tag-declare","18":"tag-decline","19":"tag-electricity","20":"tag-everyone","21":"tag-evidence","22":"tag-falls","23":"tag-futures","24":"tag-government","25":"tag-import","26":"tag-is","27":"tag-it","28":"tag-liquefied","29":"tag-lng","30":"tag-new","31":"tag-new-zealand","32":"tag-newzealand","33":"tag-nz","34":"tag-of","35":"tag-plan","36":"tag-power","37":"tag-price","38":"tag-soon","39":"tag-terminal","40":"tag-the","41":"tag-victory","42":"tag-willing","43":"tag-working"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/300327","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=300327"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/300327\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/300328"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=300327"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=300327"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=300327"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}