Meridian Energy monthly operating report for May 2019

PG 1

Meridian Energy monthly operating report for May 2019

14 June 2019
Attached is Meridian Energy Limited's monthly operating report for the month of May 2019.
Highlights this month include:
▪ In the month to 13 June 2019, national hydro storage increased from 107% to 122% of historical average
▪ South Island storage sat at 129% of average and North Island storage at 78% of average on 13 June
2019
▪ Meridian’s May 2019 monthly total inflows were 165% of historical average
▪ Meridian’s Waitaki catchment storage at the end of May 2019 was 126% of historical average
▪ Storage in Meridian’s Waiau catchment was above average at the end of May 2019
▪ National electricity demand in May 2019 was 2.0% lower than the same month last year
▪ Meridian made calls on load under the Genesis Swaption in May and early June 2019
▪ May 2019 was the third warmest May on record with warmer than average conditions across the whole
country. Rainfall was well above average in the western and lower South Island and below average for
much of the North Island
▪ New Zealand Aluminium Smelter's load during May 2019 was below the contract level of 622MW
▪ Meridian’s retail sales volumes in May 2019 were 8.5% higher than May 2018
ENDS
Neal Barclay
Chief Executive
Meridian Energy Limited

For investor relations queries, please contact:
Owen Hackston
Investor Relations Manager
021 246 4772
For media queries, please contact:
Claire Shaw
External Communications Manager
021 370 677

M O N T H LY O P ER AT I N G R EP O RT
M AY 2 0 1 9

M AY H I G H L I G H T S
In the month to 13 June
2019, national hydro
storage increased from
107% to 122% of
historical average
South Island storage sat
at 129% of average and
North Island storage at
78% of average on 13
June 2019
Meridian’s May 2019
monthly total inflows
were 165% of historical
average
May 2019 was the third
warmest May on record with
warmer than average
conditions across the whole
country. Rainfall was well
above average in the western
and lower South Island and
below average for much of
the North Island
New Zealand Aluminium
Smelter's load during May
2019 was below the contract
level of 622MW
Meridian’s retail sales
volumes in May 2019 were
8.5% higher than May 2018
Meridian’s Waitaki
catchment storage at the
end of May 2019 was
126% of historical
average
Storage in Meridian’s
Waiaucatchment was
above average at the end
of May 2019
National electricity
demand in May 2019 was
2.0% lower than the
same month last year
Meridian made calls on
load under the Genesis
Swaptionin May and
early June 2019
Meridian Energy Limited Monthly Operating Report for May 20192
14 June 2019

MARKET DATA
▪National electricity demand in May 2019
was 2.0% lower than the same month last
year
▪May 2019 was the third warmest May on
record with warmer than average
conditions across the whole country.
Rainfall was well above average in the
western and lower South Island and below
average for much of the North Island
▪Demand in the last 12 months was 0.7%
higher than the preceding 12 months
▪New Zealand Aluminium Smelter's load
during May 2019 was below the contract
level of 622MW
▪12-month average switching rate of
customers changing retailers but not
moving (“trader” switch) was 7.7% at the
end of April 2019
▪12-month average switching rate of
customers moving and changing retailers
(“move-in” switch) was 13.3% at the end
of April 2019
Source: Electricity Authority
Source: Electricity Authority
Meridian Energy Limited Monthly Operating Report for May 20193
14 June 2019
5%
7%
9%
11%
13%
15%
Apr 14Oct 14Apr 15Oct 15Apr 16Oct 16Apr 17Oct 17Apr 18Oct 18Apr 19
12 month average
MARKET ICP SWITCHING (ALL RETAILERS)
Industry Move-in SwitchIndustry Trader Switch
2,600
2,800
3,000
3,200
3,400
3,600
3,800
4,000
JanFebMarAprMayJunJulAugSepOctNovDec
GWh
NATIONAL DEMAND
Range (2009-2018)201420152016201720182019

MARKET DATA
▪May 2019 saw near-term ASX prices fall as
South Island hydro storage continued to
increase
▪National storage increased from 107% of
average on 10 May 2019 to 122% of
average on 13 June 2019
▪South Island storage increased to 129% of
historical average on 13 June 2019. North
Island storage increased to 78% of average
Source: ASX
Source: ASX
Source: NZX
Meridian Energy Limited Monthly Operating Report for May 20194
14 June 2019
50
70
90
110
130
150
Q2
2019
Q3
2019
Q4
2019
Q1
2020
Q2
2020
Q3
2020
Q4
2020
Q1
2021
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
Q3
2022
Q4
2022
$/MWh
BENMORE ASX FUTURES SETTLEMENT PRICE
29 June 201831 January 201928 February 2019
29 March 201930 April 201931 May 2019
50
70
90
110
130
150
Q2
2019
Q3
2019
Q4
2019
Q1
2020
Q2
2020
Q3
2020
Q4
2020
Q1
2021
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
Q3
2022
Q4
2022
$/MWh
OTAHUHU ASX FUTURES SETTLEMENT PRICE
29 June 201831 January 201928 February 2019
29 March 201930 April 201931 May 2019
0
1,000
2,000
3,000
4,000
5,000
JanFebMarAprMayJunJulAugSepOctNovDec
GWh
NATIONAL HYDRO STORAGE (13 June 2019)
85yr Average199220042008
2012201720182019

OPERATING INFORMATION
▪Meridian’s New Zealand customer
connection numbers rose 0.1% during
May 2019 and have risen 3.7% since June
2018
▪Retail sales volumes in May 2019 were
8.5% higher than May 2018
▪Compared to May 2018, residential/SMB
sales volumes decreased by 0.6% and
corporate sales volumes increased by
24.0%
▪To date this financial year, retail sales
volumes are 3.9% higher than same
period last year
▪This reflects a 2.2% increase in
residential/SMB sales volumes and a 6.9%
increase in corporate sales volumes
Source: Meridian
*excludes volumes sold to New Zealand Aluminium Smelters and CFDs
Source: Meridian
Meridian Energy Limited Monthly Operating Report for May 20195
14 June 2019
336
347
326
345
301
280
359
345
334
289
310
185
182
171
178
180
168
196
189
223
219
228
330
340
312
295
351
399
338
274275
272
312
326
188
189
179
180
188
190
165
164
184
170
184
176
0
100
200
300
400
500
600
JulAugSepOctNovDecJanFebMarAprMayJun
GWh
MERIDIAN'S RETAIL SALES VOLUMES*
FY19 Residential/SMBFY19 CorporateFY18 Residential/SMBFY18 Corporate
119
119
119
119119
119119
119
119
119119
107
107108
108
108
109
109
109
109
109
109
66
66
67
68
69
69
70
71
72
73
74
0
50
100
150
200
250
300
350
JulAugSepOctNovDecJanFebMarAprMayJun
ICPs ('000)
MERIDIAN'S NZ CUSTOMER CONNECTIONS
PowershopMeridian North IslandMeridian South IslandTotal FY18

OPERATING INFORMATION
▪May 2019 monthly inflows were 165% of
historical average
▪To date this financial year, inflows are
105% of historical average
▪Meridian’s Waitaki catchment storage
moved from 2,108GWh to 2,134GWh
during May 2019
▪Waitaki storage at the end of May 2019
was 126% of historical average and 2%
lower than the same time last year
▪Storage in Meridian’s Waiaucatchment
was above average at the end of May
2019
Source: Meridian
Source: Meridian
Meridian Energy Limited Monthly Operating Report for May 20196
14 June 2019
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
200520062007200820092010201120122013201420152016201720182019
GWh
Financial
year
MERIDIAN'S COMBINED CATCHMENT INFLOWS
May YTD85 year average
0
500
1,000
1,500
2,000
2,500
1-Jan1-Mar1-May1-Jul1-Sep1-Nov
GWh
MERIDIAN'S WAITAKI STORAGE
Average 1979-201320152016201720182019

OPERATING INFORMATION
▪Meridian’s New Zealand generation in May
2019 was 8.5% higher than the same
month last year, reflecting higher hydro
generation and wind generation
▪To date this financial year, Meridian’s New
Zealand generation is 9.2% higher than the
same period last year, reflecting higher
hydro generation and lower wind
generation
▪The average price Meridian received for its
generation in May 2019 was 71.9% higher
than the same month last year
▪The average price Meridian paid to supply
contracted sales in May 2019 was 76.6%
higher than the same month last year
▪To date this financial year, the average
price Meridian received for its generation
is 53.5% higher than the same period last
year and the average price paid to supply
contracted sales is 55.6% higher
Source: Meridian
*price received for Meridian’s physical generation
Source: Meridian
Meridian Energy Limited Monthly Operating Report for May 20197
14 June 2019
0
200
400
600
800
1,000
1,200
1,400
JulAugSepOctNovDecJanFebMarAprMayJun
GWh
MERIDIAN'S NEW ZEALAND GENERATION
FY19 HydroFY19 Wind
72
77
87
285
149
99
125
153
171
100
96
157
83
55
53
96
128
127
65
55
54
56
91
0
50
100
150
200
250
300
JulAugSepOctNovDecJanFebMarAprMayJun
$/MWh
MERIDIAN'S AVERAGE GENERATION PRICE*
FY19FY18

OPERATING INFORMATION
▪Meridian’s Australian generation in May
2019 was 6.3% lower than the same
month last year
▪To date this financial year, Australian
generation is 26.5% higher than the same
period last year
▪Australian retail electricity sales volumes
in May 2019 were 3.0% higher than the
same month last year
▪To date this financial year, Australian retail
electricity sales volumes are 0.1% lower
than the same period last year
Source: Meridian
Source: Meridian
Meridian Energy Limited Monthly Operating Report for May 20198
14 June 2019
74
64
43
40
37
36
33
30
33
36
49
10
11
25
30
26
23
29
21
16
11
1
69
60
67
42
32
35
40
37
44
33
51
43
2
22
2
2
0
10
20
30
40
50
60
70
80
90
JulAugSepOctNovDecJanFebMarAprMayJun
GWh
MERIDIAN'S AUSTRALIAN GENERATION
FY19 WindFY19 HydroFY18 WindFY18 Hydro
58
57
48
41
37
39
44
38
45
41
49
59
58
50
43
39
40
43
39
39
38
47
53
0
10
20
30
40
50
60
70
JulAugSepOctNovDecJanFebMarAprMayJun
GWh
AUSTRALIAN RETAIL SALES VOLUMES
FY19FY18

OPERATING INFORMATION
MAY
2019
MONTH
MAY
2018
MONTH
APRIL
2019
MONTH
MARCH
2019
MONTH
11 MONTHS
TO MAY
2019
11 MONTHS
TO MAY
2018
New Zealand contracted sales
1
Retail contracted sales volume (GWh)5384965085575,6925,479
Average retail contractedsales price ($/MWh)$112.7$112.5$105.4$101.3$104.0$104.1
NZAS sales volume (GWh)4634264484634,8634,599
Sell side derivative volumes
2
(GWh)1682441681872,1111,998
Wholesale contractedsales average price
3
($/MWh)$72.3$62.5$73.0$80.3$69.4$59.6
TotalNew Zealand customer connections
4
301,508289,431301,230299,905
New Zealand generation
Hydro generation volumes (GWh)1,1251,0371,0601,04611,19410,135
Wind generation volumes (GWh)12311399811,1431,166
Total generation volumes (GWh)1,2481,1501,1591,12812,33711,301
Average generationprice
5
($/MWh)$96.5$56.1$99.8$171.5$126.1$82.2
Acquired generation volume
6
(GWh)1491691441861,8272,061
Cost of acquired generation ($/MWh)$66.3$63.2$65.0$71.2$68.0$68.0
Acquired generation revenue average price ($/MWh)$101.9$56.5$103.1$168.4$138.8$87.2
Future contract close outs ($M)-$0.4-$0.2-$1.1-$2.8-$7.9-$3.5
Contracted sales supply volumes (GWh)1,2091,1911,1541,23712,98912,361
Cost to supplycontracted sales ($/MWh)$103.2$58.4$105.9$175.9$135.5$87.1
See following page for Australia
operating information and all
footnotes
Meridian Energy Limited Monthly Operating Report for May 20199
14 June 2019

OPERATING INFORMATION
MAY
2019
MONTH
MAY
2018
MONTH
APRIL
2019
MONTH
MARCH
2019
MONTH
11 MONTHS
TO MAY
2019
11 MONTHS
TO MAY
2018
Australia
Wind generation volumes (GWh)49513633476510
Hydro generation volumes (GWh)12111620126
Retail contracted electricity sales volume (GWh)49474145495496
Retail contracted gas sales volume (TJ)102025133010
Powershopelectricity customer connections
7
108,33297,704106,240104,450
Powershopgas customer connections
8
21,4262919,99018,225
Footnotes
1.Contracted sales volumes and volume weighted average price received from contracted customers less distribution costs
2.Derivatives sold excluding the sell-side of virtual asset swaps
3.Average price of both NZAS sales volume and sell side derivative volumes
4.Meridian Retail and PowershopNew Zealand installation control points (ICPs), excluding vacants
5.Volume weighted average price received for Meridian’s physical generation
6.Over the counter and ASX contracts excluding the buy-side of virtual asset swaps
7.Financially responsible market participants, excluding vacants
8.Meter installation registration numbers
Meridian Energy Limited Monthly Operating Report for May 201910
14 June 2019

JulAugSepOctNovDecJanFebMarAprMayJun
201820182018201820182018201920192019201920192019
New Zealand Contracted Sales
Retail contracted sales volume (GWh)521529497524481448555534557508538
Average retail contracted sales price ($/MWh)$113.1$110.7$106.7$98.3$98.5$95.5$98.2$102.0$101.3$105.4$112.7
NZAS sales volume (GWh)426426411439444463463418463448463
Sell side derivative volumes (GWh)386196140149146217157196187168168
Wholesale contracted sales average price ($/MWh)$63.9$58.5$58.0$65.9$72.7$68.9$69.4$80.6$80.3$73.0$72.3
Total New Zealand customer connections292,091292,906293,386294,695296,064296,532297,621299,351299,905301,230301,508
New Zealand Generation
Hydro generation volume (GWh)1,0701,1239598979059721,0221,0151,0461,0601,125
Wind generation volume (GWh)1269011510799831161048199123
Total generation volume (GWh)1,1961,2131,0741,0041,0041,0551,1381,1191,1281,1591,248
Average generation price ($/MWh)$72.1$77.2$86.8$284.6$149.5$98.8$125.3$153.1$171.5$99.8$96.5
Acquired generation volume (GWh)170167147200190177155142186144149
Cost of acquired generation ($/MWh)$65.7$63.1$62.5$77.7$74.7$61.7$69.3$66.6$71.2$65.0$66.3
Acquired generation revenue average price ($/MWh)$74.5$80.8$87.9$290.6$180.8$104.6$127.7$157.7$168.4$103.1$101.9
Future contract close outs ($m)-0.1-0.3-0.6-0.5-0.5-0.5-0.4-0.7-2.8-1.1-0.4
Contracted sales supply volume (GWh)1,3531,1811,0791,1421,0981,1481,2011,1861,2371,1541,209
Cost to supply contracted sales ($/MWh)$77.0$84.9$92.5$294.4$160.4$108.7$133.3$162.9$175.9$105.9$103.2
Australia
Wind generation volume (GWh)7464434037363330333649
Hydro generation volume (GWh)101125302623292116111
Retail contracted electricity sales volume (GWh)5857484137394438454149
Retail contracted gas sales volume (TJ)42040412017991325102
Powershop electricity customer connections96,74396,80196,65797,51498,61899,368101,020102,730104,450106,240108,332
Powershop gas customer connections1,1794,7767,5589,57711,33312,50814,30916,75118,22519,99021,426
FY19 OPERATING INFORMATION
Meridian Energy Limited Monthly Operating Report for May 201911
14 June 2019

JulAugSepOctNovDecJanFebMarAprMayJun
201720172017201720172017201820182018201820182018
New Zealand Contracted Sales
Retail contracted sales volume (GWh)519529491475539589503438459442496502
Average retail contracted sales price ($/MWh)$114.6$115.9$109.4$99.0$96.0$93.3$96.8$101.6$100.2$107.0$112.5$115.9
NZAS sales volume (GWh)426426411426412426426384426412426412
Sell side derivative volumes (GWh)95100111142194125182239294272244280
Wholesale contracted sales average price ($/MWh)$60.9$59.0$58.1$54.9$57.6$58.5$63.0$61.3$58.7$60.1$62.5$60.5
Total New Zealand customer connections278,595279,967280,209280,211281,314282,396283,724285,611287,167288,538289,431290,756
New Zealand Generation
Hydro generation volume (GWh)7398318679851,0008678888781,0499941,0371,131
Wind generation volume (GWh)108118116106821188010210511811396
Total generation volume (GWh)8479499831,0911,0829859689801,1541,1121,1501,227
Average generation price ($/MWh)$156.5$83.4$55.0$53.1$95.5$128.4$127.2$64.8$55.2$54.3$56.1$91.1
Acquired generation volume (GWh)282206158164178200234156152163169160
Cost of acquired generation ($/MWh)$77.4$70.1$62.5$60.6$64.9$69.9$75.4$65.0$63.6$63.9$63.2$63.4
Acquired generation revenue average price ($/MWh)$138.8$84.1$55.6$54.4$99.7$114.2$114.2$65.5$59.8$57.7$56.5$93.2
Future contract close outs ($m)-0.7-0.6-0.7-0.30.1-0.4-0.3-0.40.00.0-0.20.0
Contracted sales supply volume (GWh)1,0671,0771,0531,0541,1741,1631,1401,0861,2051,1501,1911,225
Cost to supply contracted sales ($/MWh)$155.0$88.2$59.2$54.4$100.1$126.8$130.2$69.1$59.8$57.5$58.4$95.3
Australia
Wind generation volume (GWh)696067423235403744335143
Hydro generation volume (GWh)22222
Retail contracted electricity sales volume (GWh)595850433940433939384753
Retail contracted gas sales volume (TJ)
Powershop electricity customer connections97,54797,46597,45697,76097,82897,36197,82697,49997,52297,95097,70497,241
Powershop gas customer connections29281
FY18 OPERATING INFORMATION
Meridian Energy Limited Monthly Operating Report for May 201912
14 June 2019

Acquired generationvolumesbuy-side electricity derivativesexcludingthe buy-side of virtual asset swaps
Average generation pricethe volume weighted average price received for Meridian’s physical generation
Average retail contracted sales pricevolume weighted average electricity price received from retail customers, less distribution costs
Average wholesale contracted sales pricevolume weighted average electricity price received from wholesale customers, including NZAS
Combined catchment inflowscombined water inflows into Meridian’s Waitaki and Waiau hydro storage lakes
Cost of acquired generationvolume weighted average price Meridian pays for derivatives acquired to supplement generation
Cost to supply contracted salesvolume weighted average price Meridian pays to supply contracted customer sales
Contracts for Difference (CFDs)an agreement betweenparties to pay the difference between the wholesale electricity price and an agreed fixed
price for a specified volume of electricity. CFDs do not result in the physical supply of electricity
Customer connections (NZ)number of installation control points, excluding vacants
FRMPfinancially responsible market participant, excluding vacants
GWhgigawatt hour. Enough electricity for 125 average New Zealand households for one year
Historic average inflowsthe historic average combined water inflows into Meridian’s Waitaki and Waiau hydro storage lakes over the last 84
years
Historic average storagethe historic average level of storage in Meridian’s Waitaki catchment since 1979
HVDChigh voltage direct current link between the North and South Islands of New Zealand
ICPNew Zealand installation control points, excluding vacants
ICP switchingthe number of installation control points changing retailer supplier in New Zealand, recorded in the month the
switch was initiated
MIRNmeter identification reference number
MWhmegawatt hour. Enough electricity for one average New Zealand household for 46 days
NationaldemandElectricity Authority’s reconciled grid demand www.emi.ea.govt.nz
NZASNew Zealand Aluminium SmeltersLimited
Retail sales volumescontract sales volumes to retail customers, including both non half hourly and half hourly metered customers
Sellside derivativessell-side electricity derivatives excluding thesell-side of virtual asset swaps
Virtual Asset Swaps(VAS)CFDs Meridian has with Genesis Energy and Mercury. They do not result in the physical supply of electricity
Meridian Energy Limited Monthly Operating Report for May 201913
14 June 2019
G L O S S A R Y