Following today's grid emergency, consumer advocates are calling on electricity companies to put power in the hands of the people and roll out smart-meters to avoid future outages.
Electricity pylons Photo: 123RF
Transpower issued an alert to power companies just before 8am this morning after one of Contact Energy's gas turbine units at Stratford failed to start, Genesis Energy reported a fault at its Huntly plant and the wind generation dropped from a forecast 170 megawatts to just 30.
Transpower chief executive Alison Andrew said the industry had made many improvements following the grid emergency last August, which saw 34,000 households cut off without warning on the coldest day of the year.
"You can never say never because things can happen, but we run the grid and the electricity system to avoid that wherever possible.
"And this morning was a very good example of how we have some operational issues on generation but we were able to respond well with the lines companies - all of us working together - to manage controllable load so that consumers were not affected."
'Nobody was disconnected through this event and the power system stayed stable throughout' - Transpower CEO
This morning, Transpower asked people to reduce their power consumption if possible, with insufficient electricity being generated to comfortably meet demand.
However, Andrew told Checkpoint that Transpower had not asked customers to disconnect their power.
"No one was affected by this, we didn't actually ask consumers to conserve... we didn't put a request out through social media or media channels because we were able to manage the situation without that."
Andrew said it may be necessary in the future to ask people to conserve electricity use in similar situations.
Some customers reported they had their hot water cut off as a result of the grid emergency this morning, but Andrew said this was authorised by electricity lines companies not Transpower.
Lines companies commonly used the "ripple control" method of periodically switching off hot water systems when managing challenges to the power network, she said.
Transpower's forecasts had shown demand would be "tight but manageable" this morning but the failure of two power plants meant it had to rely on power reserves, Andrew said.
Along with the failure of Genesis Energy and Contact Energy generators, the third factor in Transpower's unexpected drop in power generation was put down to a drop off in wind power generation.
The Electricity Authority's report into last August's power outages raised concerns about the accuracy of the industry's wind forecasting capabilities.
Andrew admitted Transpower needed to improve its wind forecasting capability but said it was not a major factor in today's incident.
"It contributed to the situation the forecast dropped from 90 megawatts to 30 megawatts, that's a 60 megawatt drop, normally the system would easily be able to carry that sort of variability it was the combination of the three events that caused issues," she said.
She said Transpower's response to the grid emergency this morning was helped by an industry-wide event held several weeks ago to practice for a similar scenario.
In its final report on unnecessary outages released in April, the Electricity Authority found Transpower was at fault for co-ordination and communication failures.
The regulator said following the ministerial investigation, it was monitoring Transpower more closely and ensured it followed the rules.
Electricity Authority head of monitoring and compliance Sarah Gillies said they were aware yesterday that supply could be "tight".
"So as the regulator we obviously work very closely with Transpower, they've kept us informed and the way they've handled the situation this morning is exactly the way we needed it to be handled, so we're very happy with how it went."
Contact Energy has two 100-megawatt fast-start peaker units at Stratford, but one of them has been out of action since it broke last year and the company is still waiting for the replacement to arrive from Europe.
Chief generation officer John Clark said Contact did not yet know why the remaining unit did not start this morning.
"The pilot light started but when we went to fire her up completely the gas went out.
"Our priority is always to ensure that the stations are safe to run so while we're frustrated we're working through everything and talking to the manufacturers involved to get that issue resolved as safely and as quickly as we can."
Genesis Energy said an electrical fault on a fan in one unit at Huntly caused its problem but it was expecting it to be fully operational for peak demand tonight.
However, consumer advocates argue the industry should be doing more on the demand side of the equation.
Energy consultant Molly Melhuish said households in many other countries have been able to use smart meters for years to capitalise on cheaper off-peak rates - but retailers here are not interested.
"They want to sell more power and they don't want to suppress domestic consumers using more, including in peak times."
Otago University Energy Programme director Associate Professor Michael Jack warned power cuts were increasingly likely to happen as the country moved towards its goal of 100 percent renewable energy because wind and solar power were less predictable than fossil fuels.
The solution was "unlocking demand flexibility", which some power companies do in a crude way with so-called ripple control to turn off hot water cylinders remotely.
"You could do it in a much more sophisticated way with things like the 'internet of things' where you might be able to control your hot water cylinder, any batteries you have in your house, electric vehicle charging, building heating systems, to just vary your demand."
Some lines companies were keen to reduce demand to save them building new lines, and some of the new players in the retail market were innovating.
However, the large incumbents were less motivated to change.
It would probably take government input to accelerate these kind of changes with new regulations, he said.
National's energy spokesperson Nicola Willis Photo: RNZ / Angus Dreaver
National's energy spokesperson Nicola Willis said the energy minister's main job was "to keep the lights on" - and the grid emergency showed that was at risk.
"National has been clear - we thought the decision to stop exploration for oil and gas was a bad one and we're now seeing the consequences of that.
"We are now importing more coal from Indonesia than ever before and we're seeing more insecurity in our energy supply as generators are less able to look to gas for a solution."
However, the Energy Minister Megan Woods said she was confident the system was working as it should.
"I think what we saw is actually the system worked. Some of the lessons of 9 August were implemented - ripple control was largely deployed, which took the heat out of that.
"And the advice I've had is there are about 440 megawatts of spare capacity going into the system this evening."
That was more than sufficient to ensure the lights - and the heaters - would stay on tonight, she said.