The Current State of Affairs and the Impact of Deferred Investments
Well, not that much sadly, but the optimist in me sees green shoots of regulatory progress, some generation development activity (at last), but a continued chorus of gas concerns from the choir of Generator/Retailers (gentailers) who benefit hugely from fossil fuel generation being the margin, price setting unit for spot prices.
Of course, mother nature plays her hand in New Zealand Electricity prices, increasingly so as we live with the outcome of deferred investment in new generation and the low level of attractiveness of New Zealand for new investment due to the market power exercised by a largely state owned incumbent generation sector.
Well, there have been some announcements that might ordinarily be cause for optimism; the formation of the Energy Competition Taskforce which brought together the three historically benign regulators in the Electricity Authority, the Commerce Commission and MBIE to address the mounting (mountain?) of evidence that New Zealand Electricity market isn’t delivering the outcomes we would expect for a nation so well-endowed in natural energy resources.
To their credit the task force has already implemented changes that might help, albeit at the margin with developments like adding super peak prices to the ASX energy futures market which has seen some improved liquidity and price disclosure across super peak products, and perhaps a lower peak/off-peak differential in pricing, though this may be more a reflection of increased fossil fuel pricing in off-peak periods. IE higher overall prices.
The task force has also announced a consultation on several potentially significant changes grouped as “level playing field measures”. The “proposed nondiscrimination obligations” would require Gentailers not to treat themselves substantially differently from their non-integrated competitors, or to treat different competitors substantially differently. Given the openness with which the vertically integrated incumbents have posted losses on retail while making record overall profits over the last few years this seems blindingly obvious, as a measure. It would see gentailers having to build a portfolio of internal transfer prices for hedges which would make it far more transparent for the regulators to assess hedge access (market power) issues.
Should this measure still not result in the market delivering competitive outcomes, a second measure sits behind this as a backstop, he proposed “virtual disaggregation measures” refers to splitting the flexible generation capacity of participants who exceed a certain market share into two components: a portion that would be required to be offered, and a portion that would be used by the participant as they see fit.
The Role of Government Dividends
It remains to be seen the extent to which the task force resists the inevitable strong lobbying against these measures from the incumbent players and if implemented how long it takes before we see a return to meaningful retail competition and real customer innovation.
My bet is that we will see all sorts of ballyhoo from the incumbents about how hard they are doing great, and of course, the elephant in the room is the dividends received by the government from their state-controlled gentailers, Genesis, Meridian and Mercury. I’m yet to see an economic analysis to support any assertion that the value of those dividends outweighs the value to our economy of cheap abundant energy delivered through an undistorted or workable efficient market….
However, the Q4 2024 MBIE Energy consumption Stats show that the current market isn’t working for Kiwi businesses with a 9% year-on-year fall in electricity demand from the industrial sector.
Some of this will no doubt be the closure of Winstone Pulp International and the Oji Fibre Solutions’ Penrose plants citing energy cost as a major factor in those decisions, and part is also likely the ramp down of Tiwai at Meridian’s request.
There was much heralding of the benefits to New Zealand of the new Tiwai deal, especially by Meridian:
“This is a fantastic outcome for New Zealand and the Southland region. It’s further proof that large industrial businesses can utilise New Zealand’s renewable energy advantage and create low carbon sustainable products, high value jobs and export dollars for our country.”
But now it would seem that it’s even better for New Zealand when Tiwai doesn’t run. Curious that!
Future Outlook
Another winter of extreme prices in 2025 poses yet another threat to consumer confidence in New Zealand’s electricity market, ultimately threatening the social license that incumbent generators and even distribution businesses have enjoyed for so long.
The reality is that in 2025, for perhaps the first time, grid supply companies may be facing the legitimate threat of substitution as New Zealand’s (and global) grid energy supply becomes more expensive than the delivered cost of rooftop solar for residential consumers.
Recommendations for Businesses
The same trends apply to supply for business consumers, I would go so far as to say that any business in New Zealand facing new supply costs should feel obliged to seek a quote on rooftop solar and battery.
The economics of rooftop solar in terms of delivered cost of energy will continue to improve as regulatory reforms evolve to incentivise consumers to participate in flexibility, and reward investment in distributed energy resources. While escalating grid and distribution costs are now locked in for the next five-year period we should expect to see this continue to increase. From a global perspective, New Zealand is no different to most nations looking to electrify their economies. According to Bloomberg New Energy Finance research, US$21 trillion dollars of grid investment is required to reach net zero emissions targets.
We can expect to see more and more businesses taking their destiny into their own hands as our incumbent grid suppliers seek to maximise returns from legacy assets against the improving economics of generation technologies that can generate energy at the point of consumption.
Making Business Great Again or Puff the Magic Dragon?
Generative AI is, frankly, little more than a highly trained monkey genetically spliced to a parrot.
Many New Zealand and Australian companies have been beating down the doors of high-priced consulting firms to understand just how AI might benefit them.
Another well-worn path has been to the doors of company CIO’s who in many cases seem almost as confused as the rest of us. They spout technology terms like LLM (Large Language Models), Agentic AI, Natural Language Processing, Predictive Modelling and Robotics Process Automation. Most have failed to describe practical, and measurable business benefits
After reading dozens of articles and interviewing many of my most learned colleagues in the AI space I remain underwhelmed at how New Zealand businesses are moving to leverage AI to drive profit and growth.
So what makes AI Different?
To answer that question, we need to look at the two major threads of AI – Generative AI and Agentic AI.
Generative AI is delivered in tools such as Co-Pilot, Gemini and Chat GPT. Instead of us creating our content its automation capability allows us to do instant research, generate sophisticated text and formulate bold and innovative images, all in seconds. If we don’t like what we first see we just tell the AI to do the job again. Seconds later a simpler or more detailed edit is created depending on our interaction with the system.
However, as a productivity tool, Generative AI is little more than a new generation of personal assistants. In the same way that word processing replaced millions of typists and an entire typewriter industry in the late 1980s, Generative AI will replace millions of jobs where their sole value is creating the documents necessary to do business.
In the most simple of terms, if any part of your role is creating and refining documents (sales proposals, job descriptions, tender reports, legal contracts, patient health notes, meeting agendas and minutes etc) then this part of your role will not exist within three to five years.
Scary as this may sound to some of us, including me because I like writing posts like this, Generative AI is not going to bring the world of business to an end any more than the PC and Smartphone has made our lives more tolerable and our spare time more available.
Generative AI is, frankly little more than a highly trained monkey genetically spliced to a parrot. The model is limited by its inability to learn, especially in the context of your unique business data. It cannot, for example, analyse the trends in the New Zealand electricity market and predict pricing movements based on the legal, commercial, production and consumption factors available.
Agentic AI models, however, are designed specifically for this type of reasoning.
Part Two Agentic AI. Should we welcome our new robot overlords or pull the plug now?
Since 2018, the New Zealand Electricity market has been defined by falling natural gas supplies, record quantities of coal to be burned at Huntly, inconsistent hydro storage levels and rising costs. All of these factors have led to price instability, and the timing of your next electricity contract negotiation can have a significant impact on the prices offered.
Example: Food and Beverage Industry In this example, our proactive approach to procurement achieved the green pricing before the customer’s contract end date.
In total, eight retailers bid for forward energy supply.
Had they waited until the last minute, the likely number of participant retailers would have been reduced to 3 or 4.
Advance pricing is 32% lower than last-minute pricing.
Example: Hotel Industry In this example, our proactive approach to procurement achieved the green pricing before the customer’s contract end date.
The customer was able to smooth out their energy contract costs over the term of supply.
Advance pricing is 38% lower than last-minute pricing.
Waiting until the last minute to renew your electricity contract could be risky.
Why Act Early?
Allowing your electricity contract to expire or delaying securing a new one can expose your business to unnecessary risks and higher costs. Electricity prices are highly volatile due to factors like hydro storage, so timing your contract negotiation is crucial.
Waiting too long can lead to significantly higher electricity prices. Delaying until the last minute often leaves you with fewer options and less favorable terms. By acting early, you can negotiate better terms and avoid disruptions in service or unexpected cost increases.
Strategic Planning
Start looking at prices six months before your contract ends. This gives you time to find the best deal or reassess the market closer to contract expiry.
Optimal Contract Term
The best term for your electricity contract depends on market conditions and your business goals. Longer-term contracts can offer price stability and potentially lower rates, while shorter-term agreements provide flexibility but often come with higher costs and risks.
Total Utilities procures a range of contract terms and provides recommendations that balance short-term flexibility with long-term price security, ensuring your contracts align with your business strategy and market conditions.
Shop Around
In addition to acting early, it’s essential to compare different offers. The electricity market is competitive, and prices can vary significantly between providers. By comparing offers, you can ensure your current supplier’s renewal offer is competitive.
Proactive Procurement Total Utilities offers services to help you:
Why Total Utilities? With over two decades of experience, Total Utilities conducts around 300 market reviews annually, providing strategic advice tailored to your business needs. They help optimise utility costs and ensure reliable procurement.
Smarter tools, deeper insights, better decision making — discover how Panoramic Optimise can transform your future of energy management.
Enhanced User Experience: Enjoy a sleek, intuitive design with quicker navigation and AI-driven quick search for improved results in seconds.
End-to-End Personalisation: Customise dashboards, widgets, device grouping, and naming. Tailor benchmarks, thresholds, and visualisations to your unique needs.
Continuous Innovation: Benefit from regular feature updates, cutting-edge improvements, and AI-powered features with a forward-looking roadmap.
Empowered Team Performance: Engage stakeholders across various departments with tools for teamwork, task delegation, and incident management.
Improved Performance and Security: Experience 80% faster load times, 50% fewer network errors, and top-tier data security on a robust cloud infrastructure.
Smarter Energy Intelligence: Gain deeper insights into energy patterns, custom benchmarks, and proactive maintenance with AI-powered tools tailored to your KPIs and workflows.
Smarter decisions with customisable widgets.
Multiple views, smarter insights, and deep data exploration.
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 achieve this by conducting a comprehensive site-wide energy audit (Type 1), examining everything from lighting and HVAC systems to chillers, boilers, refrigeration and other energy-intensive systems. Additionally, we install Panoramic Power our non-intrusive energy intelligence system, providing real-time device-level energy data visibility. For more information check out a brief overview of our service here.
Has your organisation invested in commercial solar panels, or are you considering deploying solar power? If so, you might be looking for ways to maximise your return on investment (ROI).
In today’s challenging business environment, adapting your energy strategy is crucial. Objective tracking of your assets’ cost and performance is becoming increasingly important. Without this data, you could face additional pressure on your bottom line, complicating your budget amid rising costs.
The Power of Panoramic Power
Panoramic Power’s end-to-end energy management and intelligence platform can help you clarify your energy picture. The benefits of real-time data start from the very beginning of your solar system’s lifetime. Panoramic Power can help you track your organisation’s electricity demand and energy costs. With real-time alerts and reporting, you’ll be able to view energy usage for your entire site. This can help you identify opportunities to cut wastage and reduce your total energy demand.
Lowering Usage and Reducing Costs
Lowering your energy usage means drawing less energy from the grid. This allows you to meet more of your total demand via your solar system, providing more stable prices and accurate forecasts. If you invested via capital sale, this could even help reduce your solar system’s payback period.
If you haven’t invested in solar power yet, tracking your energy usage can still benefit your business. Reduced usage means you’ll need a smaller system, with a 25% reduction resulting in a roughly 25% smaller solar system. This can lower your upfront costs and free up your budget for other investments.
Achieving Energy Efficiency
Energy efficiency is a priority for many organisations. For some, energy monitoring can deliver quick wins and effective short-term savings. However, progress can stall without a more granular view of energy usage and cost.
With device-level insights, you can track exactly how much energy you’re using and where. Panoramic Power provides a detailed view of where and when you could reduce your energy usage. By uncovering opportunities to cut back on wastage, you can ensure that you’re only using the energy you really need.
Transforming Your Energy Strategy
Pairing energy monitoring with commercial solar power can transform your energy strategy, offering dual benefits. Bringing your energy generation onsite reduces your reliance on grid supply, shielding you from volatile electricity prices. By tracking your energy demand, you’ll know you’re paying the right price for the right amount of electricity.
In conclusion, data-driven energy monitoring and insights can help you maximise your ROI in commercial solar power. By collecting, analysing, and acting on data-driven insights, you can bridge the gap between commitments and implementation, achieve your energy 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.
Total Utilities partners with Kristin School to provide real-time monitoring of solar panel performance with our world-class energy monitoring solution. Read their story here.
Hidden inefficiencies are draining your profits and hindering your sustainability goals.
We’re not talking about dramatic equipment failures that halt production. Instead, we’re exposing invisible efficiency killers—machines that appear fully operational while steadily eroding your bottom line and inflating your carbon emissions. The culprits are your most commonplace industrial machines: boilers, hot water systems, compressors, lighting, HVAC and refrigeration systems.
Every unit of wasted energy means lost money and unnecessary emissions. As New Zealand businesses face mounting pressure due to escalating energy prices, for executives tasked with controlling costs, Panoramic Power represents a transformative ally.
The Invisible Problem: Why Inefficiencies Go Unnoticed
Many inefficiencies remain hidden because you can’t fix what you can’t see. Machines that appear operational can quietly drain profits and inflate emissions. Without advanced energy monitoring, these “silent thieves” stay undetected, eroding both financial performance and sustainability credentials.
Total Utilities provides a simple, cost-effective way to identify quick wins and the real-time visibility needed to expose these invisible efficiency leaks, equipping businesses with actionable insights to transform waste into measurable gains.
Excessive Steam Discharge: Can account for up to 30% of energy waste.
Scale Buildup: A 1mm layer can increase fuel consumption by 2–5%.
Faulty Controls: Malfunctioning thermostats or regulators increase inefficiencies.
Real-life example: A Panoramic Power client identified that 30% of their steam was wasted. Real-time insights enabled targeted fixes, reducing gas usage and emissions.
Sediment Accumulation: Reduces heat transfer, requiring more energy.
Corrosion and Leaks: Often unnoticed until damage is extensive.
Real-life example: Monitoring revealed a pump running four times faster than needed. Adjustments led to significant energy and cost savings.
Compressed Air: The Hidden Energy Monster
Air Leaks: Drain 20–30% of output.
Short-Cycling: Misaligned systems disrupt efficiency.
Improper Pressure Settings: Cause waste and operational disruptions.
Real-life example: A bottling plant reduced compressor pressure from 100 PSI to 96 PSI, saving energy and reducing wear without affecting production.
HVAC Systems: The Silent Energy Drainers
Unbalanced Airflow: Causes some areas to overheat or over cool, wasting energy.
Dirty Filters: Reduce efficiency and increase energy consumption.
Faulty Thermostats: Lead to inconsistent temperatures and energy waste.
Real-life example: A client discovered that their HVAC system ran 24/7 due to a faulty thermostat. Fixing it saved significant energy and reduced costs.
Lighting Systems: The Overlooked Energy Consumers
Outdated Bulbs: Older lighting technology consumes more energy.
Improper Scheduling: Lights left on when not needed.
Inefficient Fixtures: Poorly designed fixtures waste light and energy.
Real-life example: A warehouse switched to LED lighting and implemented motion sensors, cutting their lighting energy use by 40%.
Refrigeration Units: The Hidden Cold Costs
Door Seals: Worn seals allow cold air to escape, increasing energy use.
Defrost Cycles: Inefficient cycles waste energy.
Temperature Settings: Incorrect settings lead to higher energy consumption.
Real-life example: A food processing plant adjusted its defrost cycles and repaired door seals, resulting in a 15% reduction in energy use.
Total Utilities leverages Panoramic Power to turn hidden inefficiencies into measurable improvements. Using real-time monitoring, predictive analytics, and customised dashboards, the platform:
Identifies inefficiencies across machines and systems.
Provides actionable insights to reduce energy waste.
This integration of visibility and intelligence empowers manufacturers to cut costs, lower emissions, and enhance competitiveness.
Why Panoramic Power Stands Out
Unlike generic energy monitoring tools, Panoramic Power aligns with executive priorities by translating data into strategic opportunities. The platform simplifies:
Inefficiency detection: Identify hidden energy drains.
Data customisation: Tailor dashboards to operational needs.
By addressing both cost savings and environmental impact, Panoramic Power helps users achieve measurable results and lead in sustainable innovation.
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 achieve this by conducting a comprehensive site-wide energy audit (Type 1), examining everything from lighting and HVAC systems to chillers, boilers, refrigeration and other energy-intensive systems. Additionally, we install Panoramic Power our non-intrusive energy intelligence system, providing real-time device-level energy data visibility. For more information check out a brief overview of our service here.
Ready to start saving? Contact us today to schedule your energy audit and begin your journey towards greater efficiency and cost savings!
