James Kilty: Transpower CEO addresses latest concerns over dwindling gas supply

Transpower says recent electricity generation simulations should not trigger panic, over declining gas supply.

Two of three tests show improvements, looking a decade ahead into how our systems will cope with demand.

But the third - the winter energy margin - finds worsening conditions, year-on-year.

Transpower's James Kilty says it's not a big deal.

"The tests include a buffer, so the fact that we're dipping slightly below the buffer does not mean that there'll be electricity supply shortages next year."

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Episode Transcript

Speaker 1 (00:00):
Transpower is warning that we urgently need more electricity generation
to come online as the gas is running out faster
than we expect it Now, according to modeling, there may
not be enough power in the grid to meet demand
next winter. James Kilty is Transpower's CEO and with us.

Speaker 2 (00:13):
Hi, James, Hither, how are you?

Speaker 1 (00:16):
I'm very well, thank you. Will we have blackouts next winter?

Speaker 2 (00:20):
No, we won't. Hither. What we've released is something called
the Security of Supply Assessment. It looks ten years ahead
and tests the electricity system's ability to meet demand and
looking at three specific tests, and we do it every year.
It's roll and report this year. What it shows is
under two of the tests, things are actually improving, getting better,

(00:43):
and under one of them, the winter energy margin, which
you often hear talked about, things are getting a little
bit worse year on year. But the tests include a buffer,
so the fact that we're dipping slightly below the buffer
does not mean that there'll be a tricity supply shortages
next year.

Speaker 1 (01:02):
Okay, what's going on with the electricity generation? Because I
thought everybody was sort of getting on with it.

Speaker 2 (01:08):
That's absolutely the case. There's an enormous amount of investment
happening around the country as we speak. So over the
last first five years of this decade, in fact, about
ten percent more electricity generation has been invested in and delivered,
and the same looks to be happening again over the
next few years. The challenges in the background. Gas supplies

(01:30):
in the country have declined more quickly than expected, and
so there's a need for us to make sure we
keep the pedal down on new investment and new development
of electricity resources.

Speaker 1 (01:40):
Yeah, I mean, it's been kind of a little bit
shocking how fast it's dropped off. Has it surprised you.

Speaker 2 (01:46):
I think it's surprised most industry members and commentators around
the industry. It is a precipitous decline in gas supply
and availability into electricity generation. As I say that leving
of investment in the system right now is quite amazing.
There's enormous amounts of investment happening, new power generation being

(02:08):
developed all around the country and new batteries, importantly, new
batteries to support the system going forward.

Speaker 1 (02:14):
Good stuff, James, thank you very much, appreciate your time.
James Kilty, Transpower CEO.

Speaker 2 (02:19):
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