Quarterly Operational Update

QUARTERLY OPERATIONAL UPDATE
Three months ended 31 December 2020
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE01
FY2021 HYDRO GENERATION FORECAST
INCREASED BY 200GWh
PRICES ELEVATED DUE TO
LOW SOUTH ISLAND INFLOWS AND
THERMAL FUEL CONSTRAINTS
CONTRACT SECURING
TIWAI SMELTER OPERATIONS
EXTENDED TO END OF 2024
>> QUARTERLY HIGHLIGHTS
3,900GWh
ELEVATED
PRICES
PERSIST
TIWAI
SMELTER
CONTRACT
EXTENDED
>> COMMENTARY
HYDRO GENERATION FLAT, LAKE TAUPO STORAGE LIFTED PRIOR TO SEASONALLY LOW INFLOW PERIOD
Mercury's hydro generation for the quarter was flat versus theprior comparable period as Mercury lifted hydro storage leading into the
historically dry January quarter. Storage in Lake Taupo increased during the quarter from 254GWh to 456GWh at the end of thequarter,
21GWh above average
1
. Higher than expected inflows also saw Mercury's FY2021 hydro generation forecast increase by 200GWh to
3,900GWh.
Geothermal generation in FY2021-Q2 of 659GWh was 63GWh higher than the prior comparable period which was affected by several
maintenance outages.
SPOT PRICES REMAIN ELEVATED DUE TO LOW SOUTH ISLAND INFLOWS AND THERMAL FUEL CONSTRAINTS
South Island hydrological inflows were below-average for the quarter resulting in decreasing national hydro storage, which endedthe quarter
639GWh below average
1
. This combined with thermal fuel constraints saw prices increase from $102/MWh at Otahuhu and $87/MWh at
Benmore in FY2020-Q2 to $117/MWh and $103/MWh respectively in the most recent quarter.
FUTURES LIFT REFLECTS HYDROLOGY, THERMAL FUEL CONSTRAINTS AND TIWAI SMELTER CONTRACT EXTENSION
Dry hydrology and thermal fuel concerns saw the FY2021 futures priceincrease from $122/MWh at Otahuhu and $111/MWh at Benmore at
the start of the quarterto $136/MWh and $121/MWh respectively. Longer-dated futures also increased with the FY2022 futures price lifting
from $100/MWh to $119/MWh at Otahuhu and from $85/MWh to $101/MWh at Benmore.
Following the quarter, it was announced that the electricity contract behind the Tiwai Point aluminium smelter would be extendedto the end
of 2024, securing smelter operations. This saw a further lift in FY2022 futures prices which were $130/MWh at Otahuhu and $115/MWh at
Benmore as at 20 January 2021.
SALES VOLUMESAND YIELDS LIFT AS MERCURY MAINTAINS FOCUS ON CUSTOMER VALUE
Physical sales volumes increased from 1,002GWh in FY2020-Q2 to 1,039GWh in the most recent quarter. Commercial and Industrial sales
volumes increased by 94GWh to 433GWh but were partially offset by Mass Market sales volumes which decreased by 57GWh to 606GWh.
Mercury's focus on customer value saw sales yields in the Mass Market segment increase by 7.7% from $129/MWh to $139/MWh and in the
Commercial and Industrial segment by 9.1% from $79/MWh to $86/MWh. Customer connections decreased by 6,000 to 336,000 across
the quarter, 20,000 lower compared to the end of FY2020-Q2.
BROAD LIFT IN ADJUSTED DEMAND WITH WEAKER INDUSTRIAL SECTOR LOAD THE EXCEPTION
National demand increased by 0.3% on a temperature-adjusted basis (down -0.4% on an unadjusted basis) with positive contributions from
the urban (+0.3%), rural (+0.1%), dairy (+0.2%), irrigation (+0.5%) and other (+0.2%) sectors. Industrial demand decreased (-1.0%) due to
reduced load at the Tiwai Point aluminium smelter and other major industrial users.
1
For quarters ended 31 December since 1999

336356
297314
3942
4547
VWAP
1
VolumeVWAP
1
VolumeVWAP
1
VolumeVWAP
1
Volume
(GWh)(GWh)(GWh)(GWh)
1,0391,0022,2962,241
2
6066631,4381,555
3
433339858686
4949109110
4
1,0881,0502,4062,351
5
9358331,7781,703
377313753636
6
5585201,0251,067
31181105379
1,5891,5243,3203,428
9309281,9742,142
7
6595961,3461,286
402391835690
6
402391835690
8
1.021.031.021.03
1
VWAP is volume weighted average energy-only price sold to customers after lines, metering and fees
2
Mass market includes residential segments and non time-of-use commercial customers
3
Fixed-price, variable-volume (FPVV) sales to time-of-use commercial customers
4
Excludes spot customer purchases
5
Excludes FTR and trading ASX positions (including positions held to maturity which were previously disclosed in CfD volumes)
6
7
Includes Mercury's 65% share of Nga Awa Purua generation
8
Includes all physical and financial buys and sells except spot customer purchases
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE02
Spot Settlement of CfDs
PORTFOLIO LWAP/GWAP
93.97108.33
Geothermal (consolidated)
ELECTRICITY GENERATION
Physical
84.3187.01 Buy CfDs
106.8293.46
87.0184.31Financial
119.92109.96
103.50114.49
Hydro
120.19109.48
86.2579.23
97.96110.79
86.70
Other Sell CfDs
110.7299.30
Physical Purchases
Financial
Spot Settlement of CfDs
End User CfDs
OPERATING INFORMATION
Three months ended
31 December 2020
Three months ended
31 December 2019
($/MWh)
Dual Fuel Customers
($/MWh)
South Island Customers
Includes Virtual Asset Swap volumes of 151 GWh for the 3 months ended 31 December 2020 and 151 GWh for the 3 months ended 31 December 2019 and of
302 GWh for the 6 months ended 31 December 2020 and 302 GWh for the 6 months ended 31 December 2019
ELECTRICITY CUSTOMERS
('000s ICPs)
ELECTRICITY SALES
North Island Customers
Commercial & Industrial
Network Losses
79.86
129.41
86.16
Physical117.21112.65
Mass Market139.36
78.55
85.94
Spot Customer Purchases
79.64
($/MWh)($/MWh)
121.87116.64
Six months ended
31 December 2020
Six months ended
31 December 2019
132.02120.39
86.8580.72
87.0878.71
138.14129.08
94.6088.48
126.39114.41
132.73119.62
86.6881.91
120.20109.06
135.43110.53
118.45103.67
117.09105.74
92.4483.06
92.4483.06
>> OPERATING STATISTICS

> ELECTRICITY GENERATION BY COMPANY FOR THE THREE MONTHS ENDED 31 DECEMBER
Source: Electricity Authority
> SHARE OF ELECTRICITY SALES (GWh) FOR THE THREE MONTHS ENDED 31 DECEMBER (EXCLUDING CFDs)
Source: Mercury Purchases and Transpower SCADA
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE03
17%
36%
19%
17%
3%
8%
Financial Year Q2 2021
MERCURY
MERIDIAN ENERGY
CONTACT ENERGY
GENESIS ENERGY
TRUSTPOWER / TILT
OTHER
>> MARKET DATA
16%
36%
20%
16%
5%
7%
Financial Year Q2 2020
11%
89%
Financial Year Q2 2021
MERCURY
OTHER
13%
87%
Financial Year Q2 2020

> OTAHUHU WHOLESALE PRICE AND NATIONAL HYDRO STORAGE LEVELS
Source: NZX Hydro and NZEM Pricing Manager (NZX)
> TAUPO STORAGE
Source: NZX Hydro
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE04
$40
$50
$60
$70
$80
$90
$100
$110
$120
$130
0
1,000
2,000
3,000
4,000
5,000
6,000
JulAugSepOctNovDecJanFebMarAprMayJun
$/MWh
GWh
AVERAGE NATIONAL STORAGEFY2020 NATIONAL STORAGE
FY2021 NATIONAL STORAGEROLLING 12 MONTH AVERAGE OTA PRICE
ROLLING 12 MONTH AVERAGE BEN PRICE
0
100
200
300
400
500
600
JulAugSepOctNovDecJanFebMarAprMayJun
GWh
AVERAGE SINCE 1999FY2020FY2021

> OTAHUHU ASX FUTURES SETTLEMENT PRICE
Source: ASX
> BENMORE ASX FUTURES SETTLEMENT PRICE
Source: ASX
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE05
$110.25
$95.68
$99.05
$114.01
$95.65
$92.56
$122.42
$100.14
$93.46
$135.59
$119.06
$103.11
$0
$20
$40
$60
$80
$100
$120
$140
$160
FY21FY22FY23
$/MWh
Financial Year
AS AT 31 DECEMBER 2019AS AT 30 JUNE 2020AS AT 30 SEPTEMBER 2020AS AT 31 DECEMBER 2020
$97.29
$85.11
$89.53
$104.40
$79.83
$75.74
$111.22
$85.19
$78.14
$120.57
$100.69
$82.16
$0
$20
$40
$60
$80
$100
$120
$140
FY21FY22FY23
$/MWh
Financial Year
AS AT 31 DECEMBER 2019AS AT 30 JUNE 2020AS AT 30 SEPTEMBER 2020AS AT 31 DECEMBER 2020

> NATIONAL CONSUMPTION (NON-TEMPERATURE ADJUSTED)
Source: Transpower Information Exchange
> AUCKLAND CLIMATE SUMMARY ( ⁰C)
FINANCIAL YEAR
Q1Q2Q3Q4
202112.316.9--
202012.316.719.514.4
201912.116.320.214.1
201812.317.220.714.3
201712.116.119.314.3
Historical Average (since 1999)11.916.119.414.2
Source: Met Service
> MONTHLY TOTAL CONSUMER RETAIL SWITCHING (ICPs)
Source: Electricity Authority
MERCURY NZ LIMITED QUARTERLY OPERATIONAL UPDATE06
8,609
8,257
8,541
8,270
8,481
8,506
1,265
1,264
1,263
1,316
1,310
1,248
0
2,000
4,000
6,000
8,000
10,000
12,000
Q2 2016Q2 2017Q2 2018Q2 2019Q2 2020Q2 2021
GWh
NATIONAL CONSUMPTIONTIWAI POINT ALUMINIUM SMELTER CONSUMPTION
0%
5%
10%
15%
20%
25%
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
50,000
Jul-15
Jan-16
Jul-16
Jan-17
Jul-17
Jan-18
Jul-18
Jan-19
Jul-19
Jan-20
Jul-20
% Churn
Monthly ICPs
NZ MARKET CHURN (LHS)ANNUAL NZ MARKET CHURN % (RHS)