In the past three to five years, legislative changes have prompted many New Zealand businesses to evaluate their contributions towards the country’s net carbon zero targets. Despite their commitment to sustainability and reducing CO2 emissions, many companies find themselves stuck at the implementation stage due to a lack of necessary data.
The Importance of Data in Sustainability
The journey towards sustainability is fundamentally dependent on data. Data is crucial, from setting decarbonisation goals to determining the actions needed to achieve those goals and monitoring progress. Most sustainability projects involve significant investments in onsite energy generation, transitioning to renewable energy sources, diversifying the energy mix, or investing in more efficient machinery.
Granular data collected at the machine, process, and facility levels empowers decision-makers to justify their investments and confidently implement sustainability initiatives.
Establishing Baselines and Monitoring Progress
Once an investment decision is made, organisations need to establish baselines and monitor progress. Highly accurate IoT devices can measure energy use and emissions across critical machinery, creating a baseline for tracking progress and identifying areas for improvement. Monitoring energy consumption, operational efficiency, and emission levels allows organisations to set realistic, data-backed sustainability targets, monitor initiatives over time, and collect the data needed to meet reporting obligations.
Case Study: The Power of Data in Action
A national retail chain, a client of Total Utilities, demonstrates the power of data in action. The Panoramic Power Energy Intelligence solution helped identify out-of-hours energy waste equivalent to 51,000kg of Scope 2 CO2 emissions. By using Panoramic Power sensors to measure the energy consumption of their HVAC system, they identified an opportunity to optimise these assets during non-operational hours, achieving $105,000 per year in total energy cost savings.
Criteria for Effective Data Utilisation
For data to successfully drive sustainability initiatives forward, it must meet the following criteria:
Generate Insights: Organisations striving for net zero need more than just raw data; they need actionable insights. A robust data tool is required to generate these insights, allowing key stakeholders to visualise the full energy picture, identify sources of waste, and determine where interventions will have the most significant economic and environmental impact.
Be Readily Shareable: Companies worldwide often suffer from data silos, where relevant data does not reach those who need it for daily operations. A data tool that facilitates easy sharing across departments and stakeholders empowers both site and management levels to carry out their tasks efficiently and accurately.
Ease Reporting Obligations: Organisations face increasing pressure to collect and maintain accurate emissions and resource consumption data and report on decarbonisation efforts. A data-driven energy monitoring strategy provides a clear view of energy and carbon performance and generates detailed reports required for regulatory and legislative compliance with Scope 1, 2, and 3 emissions.
Harness Energy Intelligence and Boost Your Sustainability Initiatives
When organisations have confidence in their data, they can better manage their energy use. Data will be the cornerstone of successful sustainability journeys going forward. By collecting, analysing, and acting on data-driven insights, manufacturing organisations can bridge the gap between commitments and implementation, achieve net-zero goals, and build a more sustainable future.
How Total Utilities Can Help
Our expert team can help you unlock significant energy savings with a short-term return on investment (ROI). Typically, we can identify up to 25% savings with an ROI of less than 2 years.
We offer the easiest-to-install, and fastest for ROI energy management solution, that scales effortlessly from a few devices to full-site or multi-site operations. Experience actionable insights and real-time analytics that drive efficiency and sustainability. Our solutions work for everyone, helping your organisation kickstart cultural transformation towards a sustainable future.
Imagine powering your organisation with clean, renewable energy while keeping costs under control. Well, a Solar Power Purchase Agreement (PPA) could help you achieve that.
A Solar PPA is a long-term contract allowing your business to procure electricity directly from a renewable power generator. This can consist of solar energy generated from on-site panels or offsite grid connected solar farms. This allows solar to be purchased as a commodity at a relatively low generation cost compared to forward energy market prices.
There are many different types of Solar PPAs–which I’ll discuss a little later in this article–so you can choose which type works best for your organisation.
Types of Solar PPAs
There are many different types of Solar PPAs, so you can choose which type works best for your organisation.
On-site PPAs
Commercial Solar PPA: This contract typically lasts 15 to 20 years and requires no upfront investment from you. The solar company takes care of everything—from designing and financing to building, operating, and maintaining the solar system at your site. You simply pay a fixed rate per kWh for the electricity generated, which is usually lower than the rates from the grid. This arrangement helps you reduce your reliance on carbon-intensive energy sources, maximise energy savings, and gain better control over your costs.
Private Wire PPA: Similar to the Commercial Solar PPA, this type utilises ground-mounted solar panels installed on nearby land. Electricity is transmitted directly to your site through a “private wire.” Like the Commercial PPA, it typically lasts 15 to 20 years and allows you to decrease your reliance on grid power while cutting costs and carbon emissions.
Off-site PPAs
Offsite PPAs are sourced from grid-scale generation assets, commonly categorised as “sleeved” or “virtual” PPAs. They offer several advantages over onsite PPAs:
The solar system can be built in optimal locations, ensuring higher efficiency.
Energy purchase amounts aren’t limited by your site’s capacity.
Contracts can be flexible, adapting to multiple sites or relocating if necessary.
Sleeved PPAs: Also known as corporate PPAs, these agreements involve you, an energy retailer, and an offsite renewable generation source. Typically, they are take-or-pay contracts, where you commit to purchasing a fixed volume of energy at a predetermined price. The retailer takes delivery of the renewable energy and incorporates it into your supply contract, often allowing up to 70% of your demand to be met by renewable sources. These contracts can range from 10 to 20 years, with shorter terms usually carrying a premium.
Virtual PPAs: Virtual PPAs, or synthetic PPAs, are structured as contracts-for-difference. They include a strike price for the generated electricity; if market prices fall below this price, you pay the generator the difference, and vice versa. This structure offers flexibility in the amount and location of energy supplied and can support multi-site models.
The New Zealand Energy Market
In New Zealand, the energy market is largely shaped by a handful of key players, with Contact, Genesis, Mercury, and Meridian accounting for around 90% of the electricity supply. This has historically limited options for large businesses seeking to secure energy directly from generators, as most businesses are seen as too small for generators to take notice. As a result, they have to deal with retailers where the cost of generation is defined by the market.
However, a wave of independent renewable energy companies is shaking things up. Collaborations like the recent partnerships between Ryman Healthcare, Mercury, and Solar Bay, or The Warehouse Group and Lodestone Energy, or Inghams and Lodestone Energy, are paving the way for organisations like yours to lock in long-term contracts at competitive rates.
How Total Utilities Can Help
Total Utilities offers PPA consultation services as part of our broader energy procurement solutions. As an independent advisor, we assess a wide range of options without bias, ensuring that we recommend the most suitable PPA strategy for your organisation.
To learn more about investing in an onsite or offsite Solar PPA, speak to our experts today.
Our forestry client pursued Toitu Enviromark and ISO 14001 certifications to achieve stringent ESG standards.
Solution:
Total Utilities guided certification journeys for global compliance and enhanced industry reputation.
Outcome:
ESG excellence achieved with outstanding environmental, social, and governance standards.
Toitu Enviromark certification elevated sustainability profile.
Prepared for ISO 14001 accreditation, establishing global forestry leadership.Result:Our partnership led to national forestry leadership, meeting ESG goals and global standards.
Result:
Our partnership led to national forestry leadership, meeting ESG goals and global standards.
New Zealand businesses are grappling with skyrocketing costs and energy inefficiencies in today’s turbulent market. But there’s good news on the horizon—hydro storage has surged significantly in the last week, offering a welcome shift.
At Total Utilities, we’ve teamed up with Panoramic Power to provide innovative solutions that help you take advantage of these changes and optimise your energy management.
Panoramic Power delivers a comprehensive, cloud-based energy management solution with mobile app access, offering the most cost-effective option on the market. With rapid ROI and customisable dashboards and reports, it’s tailored to meet your unique needs.
Let’s take a look at some of the key benefits of our powerful energy intelligence solution:
1. Illuminate and Eliminate Energy Waste
Many businesses are unaware of where they use energy within their plant or facility as utility bills don’t provide information relative to opening hours or production runs. Plus the data on the invoice is looking in the rear view mirror. Panoramic Power’s advanced monitoring technology provides real-time data relative to production schedules and operating hours to easily highlight the cost of energy waste.
2. Upgrade to Real-Time Energy Intelligence
Traditional energy monitoring often falls short as it cannot measure key devices and equipment. Our solution offers real-time insights into every piece of equipment, allowing you to monitor performance and prevent unnecessary downtime. You can track the hours your equipment runs, and immediately identify if it starts drawing more current than is expected. This allows for preventative maintenance and a proactive approach that ensures any issues are detected and resolved before they impact your operations.
3. Capitalise on Energy-Saving Opportunities
Missing out on energy-saving opportunities can be costly. Panoramic Power’s system sends timely alerts about potential savings and efficiency improvements, enabling you to act swiftly and reduce your energy costs. Stay ahead of the curve and maximise every opportunity to cut costs!
4. Implement Comprehensive Business Cases to Drive Change
One of the biggest stumbling blocks to implementing energy savings measures is inadequate data to build a comprehensive business case. Our continuous monitoring provides in-depth analysis of device level energy usage and cost, ensuring you have a complete understanding of your equipment’s running costs. This enables you to make informed decisions to enhance efficiency.
5. Address Minor Inefficiencies Before They Escalate
Small inefficiencies can accumulate and lead to significant costs. Panoramic Power helps you pinpoint and address these issues early, preventing them from becoming major problems and ensuring ongoing cost savings.
Why Total Utilities and Panoramic Power Are Your Partners in Innovation
At Total Utilities, we’re committed to finding innovative ways to help businesses like yours tackle rising energy costs. Our partnership with Panoramic Power offers you access to state-of-the-art energy intelligence technology that provides actionable insights and drives energy cost savings.
Ready to bring Energy Savings to light?
Take control of your energy costs with Total Utilities and Panoramic Power. Reach out to us today to discover how our advanced solutions can transform your energy management strategy and deliver substantial savings.
📩 Contact us now to explore how we can help you navigate the challenges of rising energy costs and implement effective, innovative solutions.
New Zealand’s energy landscape is facing a perfect storm. With hydro storage at historic lows and natural gas production declining, energy prices are surging. As we turn to costly imported coal, the impact on electricity costs is significant. In the following article, Total Utilities Director Chris Hargreaves delves into these challenges and their implications for our energy future.
The New Zealand Electricity market relies heavily on hydroelectricity, which accounts for approximately 60% of total generation in most years. This is supplemented by other baseload generation sources that are available 24/7, including geothermal, natural gas and coal.
Despite New Zealand’s significant hydroelectric capacity, our water storage is limited, usually providing only six weeks of coverage, and often dropping below 30 days during winter. To address this, natural gas and coal are used to manage water storage and provide a top up to meet energy demand.
From a hydro storage perspective, May 2024 was the driest on record. And as of 22/07, total water storage has fallen to 31% of total capacity, which is around 55% of average levels for this time of year. In addition to this, our domestic production of natural gas has been steadily falling since 2018, meaning that natural gas is used less and less for electricity generation.
Why is this important? Because if natural gas is not available, we have to use coal. This carries a much higher marginal cost as we import coal from Indonesia, and costs associated with the emissions trading scheme are much higher than natural gas (for further insights on gas production and consumption and historical electricity risk curves check out Gas Industry Co and the Electricity Authority).
The Coal Cost Dilemma
While you might say, ‘great, we have an alternative fuel source to keep the lights on,’ the downside of using coal is that it sets the price of the electricity wholesale market and drives forward retail energy contract pricing higher for large commercial and industrial customers. Lower priced forms of electricity generation such as hydroelectricity then carry a scarcity premium as demand remains strong in a time when supply is extremely constrained.
The Electricity Authority has for several years stated that we have a competitive retail market environment. As of June 2024, there are 47 electricity trading companies in the New Zealand market. Most of these only supply residential customers or are extremely niche players supplying few electricity connections.
Big Four’s Influence: Market Control and Pricing
There are four major generators in New Zealand: Contact Energy, Genesis Energy, Mercury Energy and Meridian Energy (the big four). These four together produce about 90% of New Zealand’s electricity and supply around 80% of the retail market. They hold significant power( no pun intended!) in dictating terms to smaller independent retailers that do not have generation assets.
These independent retailers face challenges in securing competitive prices for upstream energy hedging to offer their customers. They must also meet substantial prudential cover requirements with the market, which increases with rising wholesale prices. This often means that when wholesale prices escalate, the independent generators are unable to quote pricing to customers as they cannot cover prudential requirements, or they are unable to buy upstream hedging. In essence, the big four can dictate how big the independent retailers get by the way that generation supply is managed.
Over the last 10 years, New Zealand’s baseload generation capacity has declined. Genesis has mothballed part of Huntly power station, which can run on either natural gas or coal. Contact has decommissioned the gas fired generator at Otahuhu B and is now using the gas-fired baseload component of Stratford very sparingly. Similarly, Mercury has decommissioned the gas-fired Southdown power station in Penrose.
New generation has been extremely slow to come into the market, with generators blaming the uncertainty surrounding Tiwai, which has resulted in systemic price increases. This has led to Transpower issuing warnings for the last three winters that electricity generation is struggling to meet demand. The result of this was a blackout in Hamilton during 2021 and a near miss, this year.
Although wind and solar projects are increasing, their intermittent nature fails to provide the continuous coverage needed during dry years, leaving a gap created by the reduced gas supply.
The infrastructure commission states that we have a major deficit and that to meet forecast demand, generation needs to more than double over the next 30 years. This is going to cost a significant amount of money when energy prices are at record highs which businesses are already struggling to absorb. Read ‘How is our infrastructure tracking,’ by the New Zealand Infrastructure Commission to find out more on this.
Coal will also be required in greater quantities and for much longer due to the forecast shortfall in gas production over the next 3 years.
MBIE markets manager Mike Hayward says,“New Zealand has used around 150 PJ of natural gas per year for the last two years. While New Zealand holds 8.7 years of natural gas in usable reserves, field operators only expect to extract up to 140 PJ each year for the next three years.” See this MBIE report for further details.
In 2017, we were procuring five-year fixed price contracts for large industrial customers at around $75/mWh (7.5c/kWh). Pricing obtained last week averaged $170/mWh for the period 01 Jan 2025 to 31 Dec 2029.
Investment Incentives: Why New Projects Are Stalled
However, with four major generator retailers controlling the delivery of significant new generation, there’s little incentive for them to invest in new projects. Instead, they continue to profit from long-paid-off assets.
Until competition emerges in the generation market, I struggle to see how the Electricity Authority can stand behind their claims of a competitive electricity sector.
Act Now: Contact Total Utilities
Navigate the changing energy landscape with confidence. Contact Total Utilities to explore customised solutions and implement an energy management plan today!
