YEPN scopes pandemic damage

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YEPN scopes pandemic damage

1 Apr 2020 | BusinessNZ Energy Council

The Young Energy Professionals Network is seeking views on how Covid-19 is affecting the New Zealand energy sector, businesses and the country as a whole.

YEPN – which is supported by the BusinessNZ Energy Council – is asking its members how the coronavirus has affected their organisation and how they have responded to it.

The group is also seeking members’ opinions on the pandemic’s likely long-term effects on New Zealand society, the economy, industry, the environment and the energy sector.

The two surveys close 12pm on Friday. Key findings will be shared with YEPN members during April and May, followed by a series of webinars.

YEPN says the surveys aim to develop a better understanding of how New Zealand can emerge from the crisis more resilient and continue to manage its energy transition.

They are also intended to further a global dialogue on Covid-19’s impacts and facilitate information-sharing about crisis management.

Impact memo

BEC executive director Tina Schirr has issued a memo which describes the broader effects of Covid 19 across the energy sector in New Zealand and around the world.

Drawing on TESLA analysis and forecasting, she notes the lockdown has led to a drop in electricity demand and thermal generation.

Schirr says the reduced demand – 15 per cent lower on weekdays – means there is less plant generating, which has led to less available reserve in New Zealand’s energy system.

Restoration of the HVDC link to full capacity has removed large price separation between the North and South islands.

But prices are generally restrained due to lower demand and abundant southern hydro storage.

Gas producers plan for disruption

Natural gas production remains an essential service for New Zealand.

However, Schirr says producers are planning for near-term production disruption as major users curtail operations.

She also notes large volume declines in the domestic fuel market as fewer people are on the roads and fewer goods are being transported during the lockdown.

This has hurt both retail petrol and retail/commercial diesel volumes.

The Government has announced business finance support schemes, mortgage holidays, and wage subsidies – with more initiatives to come.

Part of its Covid-19 package includes a doubling of the existing Winter Energy Payment subsidy for 2020.

“But even with these responses, economic damage is inevitable,” she says.

The current turmoil could slow the country’s energy transition, according to Schirr.

“An economic recession and falling oil prices may contribute to a slowdown of wider electrification and the uptake of clean technologies including renewable generation, EVs, and hydrogen development in New Zealand.”

Survey: Business Impact and Preparedness

Survey: Future Outlook

Memo: The Impacts of Covid-19 on the Energy Sector