The frequency of blog posts fell off last year after October as we found ourselves in an early Christmas rush period. We hope to be more consistent this year. First up, our submission on the Electricity Authority’s wholesale market review.
By Greg Sise, January 18, 2022
By Greg Sise, December 20, 2021
CFD index went down, FPVV index went up, so no change to the overall index this month, which stayed at 11.1 c/kWh ($111/MWh)
By Greg Sise, November 22, 2021
The main index fell by 7.6% this month, mainly the result of a fall in the FPVV sub-index. This month the data showed six new long-term contracts of ten year terms, following on from the three that appeared last month.
By Paul Chapman, August 31, 2021
Forecasts of spot prices are an important tool in the hedging toolkit, and this post provides an overview of the role of forecasts in hedging.
By Greg Sise, July 16, 2021
The Gas Industry Company (GIC) recently released a consultation paper on gas market settings and whether these are fit for the purpose of helping New Zealand through the transition to low-carbon energy. Somewhat belatedly, here are my thoughts.
By Paul Chapman, May 28, 2021
“Are there any risks in using CFDs to hedge wholesale electricity prices?”
By Greg Sise, May 16, 2021
In New Zealand the contract-for-differences (aka CFD) is the most common off-exchange method for hedging the price of electricity traded on the wholesale market for a specified quantity and time period. In other words, the CFD is a fundamental tool in the hedging toolbox.
By Greg Sise, May 7, 2021
"Electricity prices are high at present. Gas prices are also high. Who’s setting these prices?”
By Paul Chapman, April 18, 2021
This blog post follows on from Hedging Fundamentals Part 1 and answers "Why are spot prices in the NZ wholesale electricity market so volatile?"
By Paul Chapman, March 19, 2021
This blog post breakdown the fundamentals of hedging and provides an answer to the question "What is a hedge?".
By Greg Sise, October 21, 2019
The gas market is opaque relative to the electricity market, but recent major gas field outages have prompted moves to improve transparency. One of the first improvements is an initiative by the gas industry regulator, the Gas Industry Company, which
By Greg Sise, September 27, 2019
Spot prices surged late last year when there was a prolonged, unplanned outage at the Pohokura gas field offshore Taranaki. But they haven’t come back down to where they were prior to the gas outages. In this post we look at the reasons why and ask the question on everyone’s mind – will they remain high?
By Greg Sise, June 10, 2019
This is the second in a series of three posts on what I see as the most important issues for the electricity market for the 2020s. The first issue was disclosure in the gas market, which has as much impact on electricity as it has on gas, and is woefully inadequate. The second issue, and the topic of this post, is the electricity hedge market: how it is not working for new retail
By Greg Sise, May 2, 2019
This is the first in a series of three posts on what I see as the most important issues for the electricity market, and by association the gas market, for the 2020s. This first post is actually a submission to the Gas Indsutry Company's recent consultation on information disclosure in the wholesale gas market. The GIC documents and all subsmissions can be found at
By Greg Sise, April 18, 2018
It’s ironic that this month’s announcement that there will be no new offshore oil and gas exploration permits issued in New Zealand was titled “Planning for the future…”. This announcement was totally out of the blue and if there is a “plan” somewhere, it appears that no one outside of government knows what it is.
By Greg Sise, July 19, 2017
The majority of direct and indirect participants in the electricity market, from generators and retailers through to large consumers, aren’t aware that there is an essential piece of market intelligence available free on this very web site. And this month we publish it for the 100th time.
By Greg Sise, March 6, 2017
What drives electricity prices? Demand? Fuel costs? Losses? Transmission constraints? Carbon costs? The cost of new generation? Inflows? Well they all have an impact to a certain degree. The time frames vary but the answer in the long run is surprising, especially given that we are currently running at over 80% renewable generation.
By Greg Sise, December 22, 2016
This week we released our latest quarterly Price Path, a long term forecast of spot prices, to our subscribers. 2016 has indeed been an uneventful year on the spot market, a function of a warm winter and lots of rain for generation and for pastures. However, the last quarter delivered up some very significant news on the gas front.
By Greg Sise, November 17, 2016
The 10th annual Symposium of the Otago Energy Research Centre (OERC) was held in Dunedin on 10th and 11th November. I presented at the conference, and Fergus Bevin-McCrimmon gave a presentation of the results of his research on the efficiency of electricity futures markets. Energy Link was very pleased to sponsor the prize for the best student presentation, won by PhD candidate Paul Crane for his presentation titled “Helping Support Energy Management Systems at the University of Otago”.
By Greg Sise, November 15, 2016
By Greg Sise, October 13, 2016
This is the third and final post in a series which draws on research undertaken in collaboration with the Department of Accountancy and Finance at the University of Otago. In the first post, we looked at evidence for premia in electricity futures prices. In the second post we found some surprising drivers of premia observed in futures prices. In this post we look at liquidity in the futures market, how it has evolved, and what developments or events caused it to change.
By Greg Sise, September 21, 2016
In a very quiet month, the index decreased 0.1 c/kWh to 7.9 c/kWh at Haywards, on a volume of only one CFD (hedge) contract.
By Greg Sise, September 21, 2016
Yesterday we released our latest quarterly Price Path, a long term forecast of spot prices, to our subscribers. It was an uneventful quarter since publishing our last Price Path update in July, but this update included some significant revisions of probabilities on extreme scenarios, and a large section on the viability of the thermal fleet.By Greg Sise, 21 September 2016