Tough winter ahead for power companies as demand for electricity soars

It's going to be a tough winter for the energy sector with demand expected to grow as Kiwis rely more and more on electricity.

Transpower's general manager grid delivery Mark Ryall said he thinks the system will cope but supply could be tight based on previous winters.

"There have been some challenges in recent years around having enough generation to meet capacity at peak," he said. "We have a very peaky system where first thing in the morning and last thing at night the load is a lot higher than the rest of the day."

Ryall said rolling powercuts were unlikely and a worst case scenario. "But if it got really, really tight we might ask some people to conserve some energy, try and avoid having unnecessary appliances on during those peaks."

Ahead of winter, Transpower has partially closed down the Haywards substation in Lower Hutt for maintenance and upgrades.

It's a crucial part of the country's infrastructure as it's built to withstand natural disasters. Some of the parts being replaced are almost 60 years old and cost $700,000.

The substation helps transfer power between the north and south islands via the HVDC link — cables underneath the Cook Strait.

"We only take this out once a year... so it's critical that we do this work, we keep it running reliably so when we want to turn our lights on, our heat on on the coldest night, the HDVC does its job," Ryall said.

Energy Minister Simeon Brown said he's "concerned" by the briefings he's received from officials. The Ministry of Business, Innovation and Employment told the incoming minister: "Our most immediate challenge is to ensure sufficient electricity generation to meet peak demand during cold winter mornings and evenings."

"My message to the electricity sector and to the regulators is that this is the number one priority to keep the lights on this winter," Brown said.

Flick Electric chief executive Pavan Vyas said the industry has learnt from 2021 when 34,000 were without power on the coldest night of the year.

"What is likely to happen is lots of co-ordination between Transpower and distribution companies to figure out how we can take load off the grid."

He encouraged consumers to be smarter about when they use power during those winter months. "Turn your dishwasher on before you go to bed for instance and put the laundry on in the middle of the day. And that's just going to help smooth out those peaks."

Demand for electricity has increased as the country moves to reduce emissions. More people have electric vehicles, companies are moving away from fossil fuels, and households are shifting from wood burners to heatpumps.

Transpower estimates electricity demand will increase 80% by 2050. The Commerce Commission this week signed off Transpower's plan to invest $400 million in grid upgrades.