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Malcolm Johns: Genesis Energy CEO on the Government investing more money into the business · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from News Talks'd be follow
• 0:12
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• 0:16
  Speaker 2: The government's having to stump up two hundred million dollars
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  Speaker 2: to retain its majority shareholding in Genesis after the gen
• 0:22
  Speaker 2: Taylor announced a capital rais Today the chief executive, Malcolm
• 0:25
  Speaker 2: John's is with us now home Malcolm, good evening, How
• 0:28
  Speaker 2: are you well? Thank you? What are you planning to
• 0:29
  Speaker 2: do with the money.
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  Speaker 3: We're going to build some solar farms, some grid scale
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  Speaker 3: batteries and some wind and extend the life of Antley Rankins.
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  Speaker 2: And what does it speed up your ability to do it?
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  Speaker 4: It does absolutely.
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  Speaker 3: What would have taken us ten to fifteen years will
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  Speaker 3: probably take us more like six or seven now.
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  Speaker 2: Yeah, reasonable lift in your earnings?
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  Speaker 4: Now?
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  Speaker 2: Is that down to cheap hydro un less coal burns
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  Speaker 2: in the last half year?
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  Speaker 4: It's down to a couple of things.
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  Speaker 3: Obviously, we started the half year with record low hydro
• 0:56
  Speaker 3: and snowfall in spring was very beneficial to correcting that.
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  Speaker 4: But equally we were able.
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  Speaker 3: To support industrial gas users by selling gas out to
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  Speaker 3: industrials as well.
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  Speaker 2: Yeah, what's next year looking like?
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  Speaker 4: It?
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  Speaker 2: Too early to.
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  Speaker 3: Say, when you feel it moves from wheat to dry
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  Speaker 3: within about a six week period, So the next six
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  Speaker 3: weeks looks really good, and if it keeps raining then
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  Speaker 3: it'll keep rolling forward. But you know, we have a
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  Speaker 3: pretty healthy coal stockpile now and the gas storage facilities
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  Speaker 3: are fairly well stopped. So with the lakes fall and
• 1:26
  Speaker 3: those reserve fuels in place, we're in good shape.
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  Speaker 2: Simon Wats's office has been in touch with this show
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  Speaker 2: and still trying to convince us that the LNG deal
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  Speaker 2: is a good idea, and has pointed out that the
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  Speaker 2: wholesale prices for electricity have come back for the calendar
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  Speaker 2: year of twenty eight twenty nine. Is that right?
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  Speaker 4: Do they have? Yes?
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  Speaker 2: By how much?
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  Speaker 4: From memory? It's about fifteen dollars?
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  Speaker 2: I think is that significant?
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  Speaker 3: It is in the context of where we've been. There's
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  Speaker 3: no question that the system or the trading system is
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  Speaker 3: seen more risk in the future than otherwise. So as
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  Speaker 3: we bring in different fuel options, more coal in the
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  Speaker 3: stockpile and more renewable generation into the mix, that risk
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  Speaker 3: starts to come out of the Ford view of pricing.
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  Speaker 2: Yeah, and that fifteen dollars is that directly related to
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  Speaker 2: the LNG deal.
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  Speaker 3: I can't directly relate it to any deal. I mean,
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  Speaker 3: there's a lot of generation that's being built at the moment.
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  Speaker 3: But the more reserved fuel resilience you have, the more
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  Speaker 3: certainty there is and being able to generate electricity in
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  Speaker 3: the future, and the lower that risk premium is.
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  Speaker 2: So Malcolm, we can't. Are you saying to me, we
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  Speaker 2: can't say that the fifteen dollars as a result to
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  Speaker 2: of the LNG as opposed to every other thing that
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  Speaker 2: you guys are all building at the moment.
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  Speaker 3: I don't think there's a single lever or a single
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  Speaker 3: silver billet. I think everything matters.
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  Speaker 2: Okay, Malcolm, what's happening with the power prices later this year?
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  Speaker 3: At the moment, they're looking fairly stable. Like I said,
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  Speaker 3: with full lakes and good reserve fuels, there's not much
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  Speaker 3: risk premium in the forward curve. But as I said,
• 2:59
  Speaker 3: new zealing can move from wet to dry conditions in
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  Speaker 3: about a six week period, and when that happens, you'll
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  Speaker 3: get tension in the market.
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  Speaker 2: I was meaning, are you guys putting power prices up?
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  Speaker 3: Oh?
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  Speaker 4: No, we don't have any plans in the immediate future
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  Speaker 4: to do.
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  Speaker 2: That, Malcolm, thanks very much. As always, really appreciate talking
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  Speaker 2: to you. Malcolm John's Genesis Chief Executive.
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