NZ to increase coal import to overcome fuel shortage

Genesis Power, which owns New Zealand's biggest power station, will import thermal coal from Australia and Indonesia this winter to overcome a shortage of fuel at its Huntly plan, Bloomberg reported.

The company plans to import 500,000 tonnes to build a stockpile at the 1000-megawatt plant to provide back-up generation if the country's hydro power stations are constrained by a lack of water this winter. The power station, which burns both gas and coal, is already using coal as fast as local mines can produce it, chief executive Murray Jackson said in a statement.

"Australian and Indonesian coal is available at competitive prices and in the tonnage required," Jackson said. The first delivery is expected in July.

New Zealand's average daily electricity prices surged almost eightfold this year to $NZ243 a megawatt hour yesterday, on an index measured by Marketplace Co, manager of the NZ electricity market.

Prices have risen because three months of below average rainfall has left hydro electricity reservoirs with 17 per cent less water than usual at the start of autumn.

Genesis said the coal would be shipped to the port of Tauranga and taken by rail to Huntly, 80 kilometres south of Auckland.

Last week Genesis said it had agreed with Solid Energy, New Zealand's biggest coalminer, to more than double coal purchases in the year ending June 2003.(*)