Media release: Knee-jerk political reactions unhelpful
Wellington (Wednesday, 18 August 2021): A review of last week’s blackout by Carl Hansen, the former Chief Executive of the Electricity Authority (EA), argues for a sober and careful analysis of why 35,000 consumers lost power for up to two hours on 9 August.
In a research paper published today by the New Zealand Initiative, Mr Hansen states “It is essential the Government allows the independent market regulator to identify and address any problems found.”
“It is also important the Opposition take a mature approach and resist the temptation to jump to conclusions and call for Ministerial heads to roll.”
At 6:48pm, Transpower asked lines companies to reduce demand by 1%, and followed up this request with a formal notice at 7:09pm.
“Unfortunately, the notice contained errors,” says Mr Hansen.
“The result was that consumers lost power at the same time as generation capacity was available to the system operator.”
Numerous blackouts and conservation campaigns occurred in New Zealand prior to the creation of the wholesale electricity market in 1996.
Today, blackouts are rare and the New Zealand electricity system is generally considered outstanding by world standards.
For example, a recent review by the International Energy Agency (IEA) stated:
- New Zealand has a world leading example of a well-functioning electricity market; and
- The market-driven rise in renewables was a world-class success story among IEA member countries.
“Blackouts occur in all electricity systems. Monday’s blackout, while significant, was not necessarily systemic. Repeated blackouts would be a different matter."
“We should wait for the results of the EA’s investigations before reaching any conclusions.” “Electricity systems are complex. Making politically-motivated changes would almost certainly increase the risk of blackouts in the future," says Mr Hansen.
Mr Hansen is available for comment on 0272 588 748 or carl.hansen@CapitalStrategicAdvisors.com