What do you believe is the single most important factor driving up the cost of living in Nigeria?

The prime minister has called it an "energy security crisis" and signaled a review of New Zealand's electricity market as wholesale prices spike and industries suffer.

And he's right—this year has seen pricing turmoil. August saw daily averages ranging between NZ$164.52 and $853.57 per megawatt hour (MWh). By comparison, August 2023 saw a maximum daily average price of $168.43 per MWh.

The Electricity Authority attributes this to a shortage of gas combined with low rain and inflows into our hydro lakes. The latter is a major concern. Storage levels are now around 800 gigawatt hours (GWh) less than the minimum levels in 2023, and more than 1,000GWh less than the historical mean for this time of year.

This is happening in the face of climate change, higher risk of dry years, and high projected growth in electricity demand. Electricity demand and generation scenarios released recently by the Ministry of Business, Innovation and Employment show this growth could be up to 82%, with a peak demand of between 9.1 and 12.5 gigawatts by 2050.

However, with greater electrification needed to decarbonize the economy, and aspirations to phase out all fossil fuels by 2030, some scenarios indicate the demand will be at least two to three times more. Of course, this means more generation capacity will be needed—20 to 30 gigawatts above the current ten. The question is, can New Zealand do it?

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