The Future of Electricity Generation in New Zealand

Increasing demand for electricity in New Zealand requires approximately 150 megawatts of new capacity to be installed annually. Rapidly increasing global prices for fossil fuels; the New Zealand Energy Strategy with its focus on renewable technologies; climate change policies; and a gradual shift from an energy constrained electricity system to one with capacity constraints are all factors underlying a change in the type of generation plant being installed and the location of that plant. This paper examines the likely future of the generation sector over the next 20-30 years. It is based on the work undertaken by the Electricity Commission in preparing its Statement of Opportunities, which contains scenarios describing how electricity may be generated in the future. These scenarios are produced using the Commission’s generation expansion model.