September 22, 2025 • 6 mins
There’s an expectation coal will become more popular as gas supply diminishes.
Genesis Energy's signed a two-year agreement with BT Mining to supply 240 thousand tonnes of local coal to Huntly Power Station amidst electricity shortages.
It's expected to boost the local economy and reduce reliance on Indonesian exports.
CEO Malcolm Johns told Mike Hosking they've bought all the local coal for Huntly until now – about ten thousand tonnes a year.
He says they now have a supply for ten thousand tonnes a month, economically competitive with Indonesian coal.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Good news for the Indonesian coal haters. We've got a
deal for Huntley with some local coal to generate the power.
Genesis and BT Mining have signed a two year deal
to supply two hundred and forty thousand tons of the stuff.
And Malcolm John's as the CEO of Genesis Energy and
as well, it's Malcolm morning, good morning.
Speaker 2 (00:15):
How are you very well?
Speaker 1 (00:16):
Indeed? How come this is said? This is not a criticism,
just a general inquiry. How come this has taken so long?
Given the number of texts I've got from Indonesian coal
and the coal haters and stuff. Why haven't we gone
local ages ago?
Speaker 2 (00:26):
Well, we've bought all the local coal that we've been
able to put through Huntley up until this point, and
that's been about ten thousand tons a year. We now
have a supply that's around ten thousand tons a month
and is economically competitive with Indonesian coal. So we've gone
ahead and signed an agreement.
Speaker 1 (00:43):
How does that unfold? Is this a deal to potentially
go forever, a deal to potentially increase sort of phase
out with time as we go more renewable.
Speaker 2 (00:54):
Well, we've always focused on purchasing New Zealand coal as
a priority. It has to be economically copetitive with other
coal because we've focused on the price of electricity ultimately,
and as the gas has begun to retreat here in
New Zealand, we've had to use more coal to replace that.
When the wind doesn't blow and the rain doesn't come.
Speaker 1 (01:14):
Do we get to a point and if it is,
when is it as the gas runs out but the
renewables increase, that we're all renewable, no gas, no coal.
Speaker 2 (01:23):
It's unlikely, just because of the fact that we rely
so heavily on Mother Nature to deliver rain, wind and sun.
But we will become more renewable as we go forward,
so we'll we'll use less gas and less coal, but
when we need it, we'll need quite a lot of it.
Speaker 1 (01:39):
How worried about gas? Are you?
Speaker 2 (01:42):
Very? You know, gas has been producing between six and
eight percent of New Zealand's electricity every year for a
long time, and it's no longer available to do that,
and that's causing less electricity in the system, and that's
leading to the price pinchers that we've seen over the
last twelve months or so.
Speaker 1 (01:58):
And these reports that we keep hearing about with the
there seems an element of alarmism. In other words, we're
finding this out as we go along. It's getting worse
by the day. Is that what the industry sees as well?
In other words, you learn as.
Speaker 2 (02:10):
We learn pretty much basically all our fields are reaching
end of life, particularly offshore fields and offshore field Sorry,
end of life fields become far less predictable and you're
prone to sudden declines like we've experienced over the last
twelve to eighteen months.
Speaker 1 (02:26):
And so when you say end of life, you don't
mean literally no gas. You just mean that the demand
outstrips the supply.
Speaker 2 (02:33):
No, I'm meaning that as a gas well comes to
the end of life, it's production, its production becomes unpredictable,
and it will at some stage cease to produce.
Speaker 1 (02:42):
Wow. So given our predicament, where does that leave coal
long term?
Speaker 2 (02:46):
Well? At the moment, we're effectively leaning back on coal
to secure our electricity system because we're able to do that.
We're very lucky that we're able to do that. Otherwise
the energy crunch we're in would be far more significant.
But obviously, as I said, you know, gas has played
two critical roles. One is it's delivered base load electricity
about six eight percent of it, and then we've used
(03:08):
it to back up the hydro lakes during dry years
and it's just simply not available to do that anymore.
Speaker 1 (03:13):
And as Huntley up to this going forward and in
an increasing capacity or not.
Speaker 2 (03:19):
Huntley is at capacity in terms of its ability to
secure the electricity system, there will need to be other
interventions going forward to secure the system. For example, we
have oney four hundred megawatts of wind generation. We can
lose ninety percent of that in a wind hole, and
Huntley can only provide around seven hundred and twenty megawatts
(03:39):
of backup, So seven hundred and twenty plays fourteen hundred.
You can see the maths don't work.
Speaker 1 (03:45):
So where do I with the potential for importation of
gas that the government raised about a year ago.
Speaker 2 (03:52):
Well, that's been looked at. It's a difficult proposition, but
ultimately some form of as supply or some form of
coal supply is going to be essential to securing a
high renewables grid at least for the next ten to
fifteen years. Because you know, we're a small island and
sometimes it doesn't rain, and when you get a break
high precious system over the country, the wind stops everywhere,
(04:16):
and so that's the reality of a high renewables grid
is you're going to have to secure.
Speaker 1 (04:19):
It with something I like nuclear and I have for years,
and I'm assuming I'm completely wasting my time even having
the conversation of this country. But I look to the
world and nuclear is back and back in a big way.
Have we missed a trick or were we never in
the game?
Speaker 2 (04:34):
Well, nuclear is not lawful in New Zealand. You know,
it's not something anyone that I'm aware of is looking at,
although there's a lot of research going on into different
types of nuclear and different scales of nuclear, And you
know that's something that the rest of the world is
looking at.
Speaker 1 (04:53):
And are they doing that in a sense of some
wisdom that we may regret, do you think or not? Well?
Speaker 2 (04:59):
I think particular as AI and data centers begin to
populate the world, energy is going to become something that
is critically challenging for a high technology future. And every country,
every western country in the world, is grappling with the
challenges that New Zealand is grappling with as we transition
our energy systems.
Speaker 1 (05:16):
Well exactly, so if we transition ours using more coal
at Huntley, how do we bring in these data centers
and run the AI when we can barely run ourselves.
Speaker 2 (05:25):
Well, I think it's important to remember that we've got
more than enough renewable opportunities and more than enough people
wanting to invest in those renewable opportunities to meet all
of that demand in the future. What we're talking about
is how we bring energy security into that and that's
a role that Huntley plays. As we build more solar,
we'll be able to use our hydrolakes more to do
(05:45):
that job as well. So no one thing is going
to solve this. It's going to be a range of
options that are needed to secure a high renewable energy system.
Speaker 1 (05:54):
Always enjoy the chap, malcomppreciate Malcolm Johns, who is the
Genesis chief executive. Wellie, Mike, surely a couple of nuclear
power stations are becoming a no brainer. No, they won't
be in this country. You won't even have the conversation. Guarantee.
It's a boat we will miss in thirty years time,
twenty years time, we will regret it. Mark my words, Mike.
We're lucky to still have Huntley. The Key government had
a quote on decommissioning the power plant when they held
(06:16):
the power. It's interesting, isn't it, how life turns? And
where once coal was hated and it needed to be
gotten rid of forthwith, and Huntley was a geriatric, old
facility that could be pushed into the river and never
to be thought of again. And yet all of a sudden,
look how reliant we are on it.
Speaker 2 (06:32):
For more from the Mike Asking Breakfast, listen live to
news talks i'd Be from six am weekdays, or follow
the podcast on iHeartRadio.
Good news for the Indonesian coal haters. We've got a
deal for Huntley with some local coal to generate the power.
Genesis and BT Mining have signed a two year deal
to supply two hundred and forty thousand tons of the stuff.
And Malcolm John's as the CEO of Genesis Energy and
as well, it's Malcolm morning, good morning.
Speaker 2 (00:15):
How are you very well?
Speaker 1 (00:16):
Indeed? How come this is said? This is not a criticism,
just a general inquiry. How come this has taken so long?
Given the number of texts I've got from Indonesian coal
and the coal haters and stuff. Why haven't we gone
local ages ago?
Speaker 2 (00:26):
Well, we've bought all the local coal that we've been
able to put through Huntley up until this point, and
that's been about ten thousand tons a year. We now
have a supply that's around ten thousand tons a month
and is economically competitive with Indonesian coal. So we've gone
ahead and signed an agreement.
Speaker 1 (00:43):
How does that unfold? Is this a deal to potentially
go forever, a deal to potentially increase sort of phase
out with time as we go more renewable.
Speaker 2 (00:54):
Well, we've always focused on purchasing New Zealand coal as
a priority. It has to be economically copetitive with other
coal because we've focused on the price of electricity ultimately,
and as the gas has begun to retreat here in
New Zealand, we've had to use more coal to replace that.
When the wind doesn't blow and the rain doesn't come.
Speaker 1 (01:14):
Do we get to a point and if it is,
when is it as the gas runs out but the
renewables increase, that we're all renewable, no gas, no coal.
Speaker 2 (01:23):
It's unlikely, just because of the fact that we rely
so heavily on Mother Nature to deliver rain, wind and sun.
But we will become more renewable as we go forward,
so we'll we'll use less gas and less coal, but
when we need it, we'll need quite a lot of it.
Speaker 1 (01:39):
How worried about gas? Are you?
Speaker 2 (01:42):
Very? You know, gas has been producing between six and
eight percent of New Zealand's electricity every year for a
long time, and it's no longer available to do that,
and that's causing less electricity in the system, and that's
leading to the price pinchers that we've seen over the
last twelve months or so.
Speaker 1 (01:58):
And these reports that we keep hearing about with the
there seems an element of alarmism. In other words, we're
finding this out as we go along. It's getting worse
by the day. Is that what the industry sees as well?
In other words, you learn as.
Speaker 2 (02:10):
We learn pretty much basically all our fields are reaching
end of life, particularly offshore fields and offshore field Sorry,
end of life fields become far less predictable and you're
prone to sudden declines like we've experienced over the last
twelve to eighteen months.
Speaker 1 (02:26):
And so when you say end of life, you don't
mean literally no gas. You just mean that the demand
outstrips the supply.
Speaker 2 (02:33):
No, I'm meaning that as a gas well comes to
the end of life, it's production, its production becomes unpredictable,
and it will at some stage cease to produce.
Speaker 1 (02:42):
Wow. So given our predicament, where does that leave coal
long term?
Speaker 2 (02:46):
Well? At the moment, we're effectively leaning back on coal
to secure our electricity system because we're able to do that.
We're very lucky that we're able to do that. Otherwise
the energy crunch we're in would be far more significant.
But obviously, as I said, you know, gas has played
two critical roles. One is it's delivered base load electricity
about six eight percent of it, and then we've used
(03:08):
it to back up the hydro lakes during dry years
and it's just simply not available to do that anymore.
Speaker 1 (03:13):
And as Huntley up to this going forward and in
an increasing capacity or not.
Speaker 2 (03:19):
Huntley is at capacity in terms of its ability to
secure the electricity system, there will need to be other
interventions going forward to secure the system. For example, we
have oney four hundred megawatts of wind generation. We can
lose ninety percent of that in a wind hole, and
Huntley can only provide around seven hundred and twenty megawatts
(03:39):
of backup, So seven hundred and twenty plays fourteen hundred.
You can see the maths don't work.
Speaker 1 (03:45):
So where do I with the potential for importation of
gas that the government raised about a year ago.
Speaker 2 (03:52):
Well, that's been looked at. It's a difficult proposition, but
ultimately some form of as supply or some form of
coal supply is going to be essential to securing a
high renewables grid at least for the next ten to
fifteen years. Because you know, we're a small island and
sometimes it doesn't rain, and when you get a break
high precious system over the country, the wind stops everywhere,
(04:16):
and so that's the reality of a high renewables grid
is you're going to have to secure.
Speaker 1 (04:19):
It with something I like nuclear and I have for years,
and I'm assuming I'm completely wasting my time even having
the conversation of this country. But I look to the
world and nuclear is back and back in a big way.
Have we missed a trick or were we never in
the game?
Speaker 2 (04:34):
Well, nuclear is not lawful in New Zealand. You know,
it's not something anyone that I'm aware of is looking at,
although there's a lot of research going on into different
types of nuclear and different scales of nuclear, And you
know that's something that the rest of the world is
looking at.
Speaker 1 (04:53):
And are they doing that in a sense of some
wisdom that we may regret, do you think or not? Well?
Speaker 2 (04:59):
I think particular as AI and data centers begin to
populate the world, energy is going to become something that
is critically challenging for a high technology future. And every country,
every western country in the world, is grappling with the
challenges that New Zealand is grappling with as we transition
our energy systems.
Speaker 1 (05:16):
Well exactly, so if we transition ours using more coal
at Huntley, how do we bring in these data centers
and run the AI when we can barely run ourselves.
Speaker 2 (05:25):
Well, I think it's important to remember that we've got
more than enough renewable opportunities and more than enough people
wanting to invest in those renewable opportunities to meet all
of that demand in the future. What we're talking about
is how we bring energy security into that and that's
a role that Huntley plays. As we build more solar,
we'll be able to use our hydrolakes more to do
(05:45):
that job as well. So no one thing is going
to solve this. It's going to be a range of
options that are needed to secure a high renewable energy system.
Speaker 1 (05:54):
Always enjoy the chap, malcomppreciate Malcolm Johns, who is the
Genesis chief executive. Wellie, Mike, surely a couple of nuclear
power stations are becoming a no brainer. No, they won't
be in this country. You won't even have the conversation. Guarantee.
It's a boat we will miss in thirty years time,
twenty years time, we will regret it. Mark my words, Mike.
We're lucky to still have Huntley. The Key government had
a quote on decommissioning the power plant when they held
(06:16):
the power. It's interesting, isn't it, how life turns? And
where once coal was hated and it needed to be
gotten rid of forthwith, and Huntley was a geriatric, old
facility that could be pushed into the river and never
to be thought of again. And yet all of a sudden,
look how reliant we are on it.
Speaker 2 (06:32):
For more from the Mike Asking Breakfast, listen live to
news talks i'd Be from six am weekdays, or follow
the podcast on iHeartRadio.
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