Channel secures long term renewable electricity supply

channelnz.com


NZX RELEASE
16 June 2023


Channel secures long term renewable electricity supply

Channel Infrastructure (CHI) announces that, following a formal market tendering process, it has now entered
into a long-term fixed price variable volume contract for the supply of renewable electricity from 1 January
2024.

The electricity supply arrangements under this new contract include Energy Attribute Certificates, certifying
that electricity has been generated from renewable sources, and is for a period of 6 years with the right to
extend for a further 2.25 years to 31 March 2032 at the option of Channel.

The electricity price is fixed
1
over the contract term and implies an annual electricity supply cost of c.$6 million
per annum (based on estimated electricity consumption) over the initial 6-year contract term, and, if the option
to extend is exercised, c.$5.5 million per annum over the subsequent 2.25-year period. This represents a
saving of over $2 million per annum over the initial contract term against the 2023 contracted supply price.

Commenting, CEO Rob Buchanan said: “Electricity is a key operating cost for our business. The physical
supply contract mitigates our volume risk and provides long-term cost certainty, which allows Channel to
focus on its core business. A significant portion of our revenue is subject to indexation, therefore fixing one
of our largest operating costs is expected to deliver an improved earnings profile from 2024 onwards.”

“Importantly, Energy Attribute Certificates will underpin our commitment to renewable sources of electricity.
Meeting all our electricity needs from renewable sources would mean that Channel will have largely
eliminated its direct emissions from 2024 - some six years ahead of the company’s target. Our fully consented
solar farm project, Maranga Ra, remains a significant development opportunity, and – while its peak capacity
is now significantly larger that the terminal’s energy requirements – we will continue to evaluate opportunities
for this project, alongside other Marsden Point site repurposing opportunities.”

“Delivering a low-cost, secure and renewable electricity supply was one of our key priorities for 2023 and I
am pleased Channel has been well supported by the market. Having reset our transmission and now our
supply costs, we will focus on options to reduce our connection costs.”


- ENDS -

Authorised by
Chris Bougen
General Counsel and Company Secretary

Investor Relations contact:
Anna Bonney
investorrelations@channelnz.com


1
Levelised electricity price over the contract term and not subject to indexation.

channelnz.com
Media contact:
Laura Malcolm
communications@channelnz.com
+64 21 02363 297

About Channel Infrastructure NZ
Channel Infrastructure is New Zealand’s leading fuel infrastructure company.
Channel Infrastructure owns critical infrastructure, supplying the Northland and Auckland markets, which
make up 40% of New Zealand’s transport fuel demand and all of the jet fuel to the Auckland International
Airport. Utilising the deep-water harbour and jetty infrastructure at Marsden Point, as well as 280 million
litres of storage tanks, and the 170-kilometre pipeline from Marsden Point to Auckland we receive, store, test
and distribute fuel owned by our customers. Channel Infrastructure’s wholly-owned subsidiary, Independent
Petroleum Laboratory Limited, provides fuel quality testing services at Marsden Point and around New
Zealand.
Channel Infrastructure is well positioned to support New Zealand’s changing future fuel needs, with growth
opportunities at the Marsden Point site including additional fuel storage to support fuel security, and work
underway with customers and partners on biofuel and hydrogen opportunities.
For more information on Channel Infrastructure, please visit: www.channelnz.com