1 00:00:00,080 --> 00:00:02,120 Speaker 1: Good news for the Indonesian coal haters. We've got a 2 00:00:02,160 --> 00:00:04,680 Speaker 1: deal for Huntley with some local coal to generate the power. 3 00:00:04,680 --> 00:00:07,080 Speaker 1: Genesis and BT Mining have signed a two year deal 4 00:00:07,120 --> 00:00:10,200 Speaker 1: to supply two hundred and forty thousand tons of the stuff. 5 00:00:10,200 --> 00:00:12,800 Speaker 1: And Malcolm John's as the CEO of Genesis Energy and 6 00:00:12,840 --> 00:00:15,240 Speaker 1: as well, it's Malcolm morning, good morning. 7 00:00:15,240 --> 00:00:16,160 Speaker 2: How are you very well? 8 00:00:16,160 --> 00:00:18,280 Speaker 1: Indeed? How come this is said? This is not a criticism, 9 00:00:18,320 --> 00:00:20,560 Speaker 1: just a general inquiry. How come this has taken so long? 10 00:00:20,600 --> 00:00:23,120 Speaker 1: Given the number of texts I've got from Indonesian coal 11 00:00:23,160 --> 00:00:24,919 Speaker 1: and the coal haters and stuff. Why haven't we gone 12 00:00:24,920 --> 00:00:25,720 Speaker 1: local ages ago? 13 00:00:26,680 --> 00:00:28,640 Speaker 2: Well, we've bought all the local coal that we've been 14 00:00:28,680 --> 00:00:31,760 Speaker 2: able to put through Huntley up until this point, and 15 00:00:31,800 --> 00:00:35,120 Speaker 2: that's been about ten thousand tons a year. We now 16 00:00:35,240 --> 00:00:38,360 Speaker 2: have a supply that's around ten thousand tons a month 17 00:00:38,600 --> 00:00:42,440 Speaker 2: and is economically competitive with Indonesian coal. So we've gone 18 00:00:42,440 --> 00:00:43,640 Speaker 2: ahead and signed an agreement. 19 00:00:43,800 --> 00:00:48,080 Speaker 1: How does that unfold? Is this a deal to potentially 20 00:00:48,120 --> 00:00:51,479 Speaker 1: go forever, a deal to potentially increase sort of phase 21 00:00:51,520 --> 00:00:53,320 Speaker 1: out with time as we go more renewable. 22 00:00:54,320 --> 00:00:57,959 Speaker 2: Well, we've always focused on purchasing New Zealand coal as 23 00:00:57,960 --> 00:01:01,280 Speaker 2: a priority. It has to be economically copetitive with other 24 00:01:01,320 --> 00:01:04,839 Speaker 2: coal because we've focused on the price of electricity ultimately, 25 00:01:05,800 --> 00:01:08,640 Speaker 2: and as the gas has begun to retreat here in 26 00:01:08,680 --> 00:01:11,240 Speaker 2: New Zealand, we've had to use more coal to replace that. 27 00:01:11,400 --> 00:01:13,400 Speaker 2: When the wind doesn't blow and the rain doesn't come. 28 00:01:14,080 --> 00:01:15,880 Speaker 1: Do we get to a point and if it is, 29 00:01:16,000 --> 00:01:18,800 Speaker 1: when is it as the gas runs out but the 30 00:01:18,800 --> 00:01:22,280 Speaker 1: renewables increase, that we're all renewable, no gas, no coal. 31 00:01:23,560 --> 00:01:26,479 Speaker 2: It's unlikely, just because of the fact that we rely 32 00:01:26,640 --> 00:01:29,800 Speaker 2: so heavily on Mother Nature to deliver rain, wind and sun. 33 00:01:30,480 --> 00:01:33,200 Speaker 2: But we will become more renewable as we go forward, 34 00:01:33,640 --> 00:01:36,720 Speaker 2: so we'll we'll use less gas and less coal, but 35 00:01:36,760 --> 00:01:38,800 Speaker 2: when we need it, we'll need quite a lot of it. 36 00:01:39,120 --> 00:01:40,800 Speaker 1: How worried about gas? Are you? 37 00:01:42,160 --> 00:01:45,720 Speaker 2: Very? You know, gas has been producing between six and 38 00:01:45,760 --> 00:01:48,160 Speaker 2: eight percent of New Zealand's electricity every year for a 39 00:01:48,200 --> 00:01:50,640 Speaker 2: long time, and it's no longer available to do that, 40 00:01:51,520 --> 00:01:54,840 Speaker 2: and that's causing less electricity in the system, and that's 41 00:01:54,920 --> 00:01:57,160 Speaker 2: leading to the price pinchers that we've seen over the 42 00:01:57,240 --> 00:01:58,240 Speaker 2: last twelve months or so. 43 00:01:58,440 --> 00:02:01,520 Speaker 1: And these reports that we keep hearing about with the 44 00:02:01,520 --> 00:02:04,680 Speaker 1: there seems an element of alarmism. In other words, we're 45 00:02:04,720 --> 00:02:06,920 Speaker 1: finding this out as we go along. It's getting worse 46 00:02:06,960 --> 00:02:09,080 Speaker 1: by the day. Is that what the industry sees as well? 47 00:02:09,120 --> 00:02:10,400 Speaker 1: In other words, you learn as. 48 00:02:10,280 --> 00:02:14,760 Speaker 2: We learn pretty much basically all our fields are reaching 49 00:02:14,880 --> 00:02:18,680 Speaker 2: end of life, particularly offshore fields and offshore field Sorry, 50 00:02:19,000 --> 00:02:21,799 Speaker 2: end of life fields become far less predictable and you're 51 00:02:21,880 --> 00:02:25,520 Speaker 2: prone to sudden declines like we've experienced over the last 52 00:02:25,520 --> 00:02:26,560 Speaker 2: twelve to eighteen months. 53 00:02:26,639 --> 00:02:28,160 Speaker 1: And so when you say end of life, you don't 54 00:02:28,200 --> 00:02:30,799 Speaker 1: mean literally no gas. You just mean that the demand 55 00:02:30,840 --> 00:02:31,800 Speaker 1: outstrips the supply. 56 00:02:33,080 --> 00:02:35,680 Speaker 2: No, I'm meaning that as a gas well comes to 57 00:02:35,720 --> 00:02:39,959 Speaker 2: the end of life, it's production, its production becomes unpredictable, 58 00:02:39,960 --> 00:02:41,920 Speaker 2: and it will at some stage cease to produce. 59 00:02:42,120 --> 00:02:45,040 Speaker 1: Wow. So given our predicament, where does that leave coal 60 00:02:45,240 --> 00:02:46,560 Speaker 1: long term? 61 00:02:46,840 --> 00:02:50,040 Speaker 2: Well? At the moment, we're effectively leaning back on coal 62 00:02:50,160 --> 00:02:53,640 Speaker 2: to secure our electricity system because we're able to do that. 63 00:02:53,720 --> 00:02:55,919 Speaker 2: We're very lucky that we're able to do that. Otherwise 64 00:02:55,960 --> 00:02:59,560 Speaker 2: the energy crunch we're in would be far more significant. 65 00:03:00,160 --> 00:03:02,200 Speaker 2: But obviously, as I said, you know, gas has played 66 00:03:02,520 --> 00:03:05,640 Speaker 2: two critical roles. One is it's delivered base load electricity 67 00:03:05,720 --> 00:03:08,440 Speaker 2: about six eight percent of it, and then we've used 68 00:03:08,480 --> 00:03:11,240 Speaker 2: it to back up the hydro lakes during dry years 69 00:03:11,240 --> 00:03:13,480 Speaker 2: and it's just simply not available to do that anymore. 70 00:03:13,560 --> 00:03:16,600 Speaker 1: And as Huntley up to this going forward and in 71 00:03:16,639 --> 00:03:18,320 Speaker 1: an increasing capacity or not. 72 00:03:19,360 --> 00:03:22,079 Speaker 2: Huntley is at capacity in terms of its ability to 73 00:03:22,120 --> 00:03:25,359 Speaker 2: secure the electricity system, there will need to be other 74 00:03:25,440 --> 00:03:29,639 Speaker 2: interventions going forward to secure the system. For example, we 75 00:03:29,720 --> 00:03:32,960 Speaker 2: have oney four hundred megawatts of wind generation. We can 76 00:03:33,040 --> 00:03:36,400 Speaker 2: lose ninety percent of that in a wind hole, and 77 00:03:36,480 --> 00:03:39,560 Speaker 2: Huntley can only provide around seven hundred and twenty megawatts 78 00:03:39,560 --> 00:03:42,680 Speaker 2: of backup, So seven hundred and twenty plays fourteen hundred. 79 00:03:43,400 --> 00:03:44,680 Speaker 2: You can see the maths don't work. 80 00:03:45,720 --> 00:03:48,960 Speaker 1: So where do I with the potential for importation of 81 00:03:49,040 --> 00:03:51,480 Speaker 1: gas that the government raised about a year ago. 82 00:03:52,960 --> 00:03:57,280 Speaker 2: Well, that's been looked at. It's a difficult proposition, but 83 00:03:57,640 --> 00:04:01,840 Speaker 2: ultimately some form of as supply or some form of 84 00:04:01,920 --> 00:04:04,520 Speaker 2: coal supply is going to be essential to securing a 85 00:04:04,600 --> 00:04:07,280 Speaker 2: high renewables grid at least for the next ten to 86 00:04:07,280 --> 00:04:10,520 Speaker 2: fifteen years. Because you know, we're a small island and 87 00:04:10,600 --> 00:04:12,800 Speaker 2: sometimes it doesn't rain, and when you get a break 88 00:04:12,880 --> 00:04:16,080 Speaker 2: high precious system over the country, the wind stops everywhere, 89 00:04:16,160 --> 00:04:18,680 Speaker 2: and so that's the reality of a high renewables grid 90 00:04:18,760 --> 00:04:20,280 Speaker 2: is you're going to have to secure. 91 00:04:19,880 --> 00:04:23,279 Speaker 1: It with something I like nuclear and I have for years, 92 00:04:23,360 --> 00:04:26,400 Speaker 1: and I'm assuming I'm completely wasting my time even having 93 00:04:26,400 --> 00:04:28,159 Speaker 1: the conversation of this country. But I look to the 94 00:04:28,200 --> 00:04:30,480 Speaker 1: world and nuclear is back and back in a big way. 95 00:04:31,120 --> 00:04:32,960 Speaker 1: Have we missed a trick or were we never in 96 00:04:33,000 --> 00:04:33,360 Speaker 1: the game? 97 00:04:34,120 --> 00:04:37,440 Speaker 2: Well, nuclear is not lawful in New Zealand. You know, 98 00:04:38,200 --> 00:04:40,680 Speaker 2: it's not something anyone that I'm aware of is looking at, 99 00:04:40,760 --> 00:04:44,240 Speaker 2: although there's a lot of research going on into different 100 00:04:44,279 --> 00:04:49,240 Speaker 2: types of nuclear and different scales of nuclear, And you 101 00:04:49,279 --> 00:04:52,320 Speaker 2: know that's something that the rest of the world is 102 00:04:52,360 --> 00:04:52,800 Speaker 2: looking at. 103 00:04:53,160 --> 00:04:55,400 Speaker 1: And are they doing that in a sense of some 104 00:04:55,640 --> 00:04:59,240 Speaker 1: wisdom that we may regret, do you think or not? Well? 105 00:04:59,279 --> 00:05:02,279 Speaker 2: I think particular as AI and data centers begin to 106 00:05:02,279 --> 00:05:05,039 Speaker 2: populate the world, energy is going to become something that 107 00:05:05,200 --> 00:05:10,479 Speaker 2: is critically challenging for a high technology future. And every country, 108 00:05:10,480 --> 00:05:12,560 Speaker 2: every western country in the world, is grappling with the 109 00:05:12,680 --> 00:05:15,160 Speaker 2: challenges that New Zealand is grappling with as we transition 110 00:05:15,200 --> 00:05:16,120 Speaker 2: our energy systems. 111 00:05:16,279 --> 00:05:19,080 Speaker 1: Well exactly, so if we transition ours using more coal 112 00:05:19,120 --> 00:05:22,120 Speaker 1: at Huntley, how do we bring in these data centers 113 00:05:22,160 --> 00:05:24,960 Speaker 1: and run the AI when we can barely run ourselves. 114 00:05:25,680 --> 00:05:27,840 Speaker 2: Well, I think it's important to remember that we've got 115 00:05:27,839 --> 00:05:31,119 Speaker 2: more than enough renewable opportunities and more than enough people 116 00:05:31,160 --> 00:05:34,480 Speaker 2: wanting to invest in those renewable opportunities to meet all 117 00:05:34,520 --> 00:05:37,480 Speaker 2: of that demand in the future. What we're talking about 118 00:05:37,720 --> 00:05:40,600 Speaker 2: is how we bring energy security into that and that's 119 00:05:40,600 --> 00:05:43,560 Speaker 2: a role that Huntley plays. As we build more solar, 120 00:05:43,640 --> 00:05:45,920 Speaker 2: we'll be able to use our hydrolakes more to do 121 00:05:45,960 --> 00:05:48,880 Speaker 2: that job as well. So no one thing is going 122 00:05:48,920 --> 00:05:50,839 Speaker 2: to solve this. It's going to be a range of 123 00:05:50,880 --> 00:05:54,640 Speaker 2: options that are needed to secure a high renewable energy system. 124 00:05:54,760 --> 00:05:57,279 Speaker 1: Always enjoy the chap, malcomppreciate Malcolm Johns, who is the 125 00:05:57,680 --> 00:06:00,800 Speaker 1: Genesis chief executive. Wellie, Mike, surely a couple of nuclear 126 00:06:00,839 --> 00:06:03,320 Speaker 1: power stations are becoming a no brainer. No, they won't 127 00:06:03,320 --> 00:06:06,320 Speaker 1: be in this country. You won't even have the conversation. Guarantee. 128 00:06:06,320 --> 00:06:08,599 Speaker 1: It's a boat we will miss in thirty years time, 129 00:06:08,680 --> 00:06:12,320 Speaker 1: twenty years time, we will regret it. Mark my words, Mike. 130 00:06:12,360 --> 00:06:14,360 Speaker 1: We're lucky to still have Huntley. The Key government had 131 00:06:14,400 --> 00:06:16,680 Speaker 1: a quote on decommissioning the power plant when they held 132 00:06:16,720 --> 00:06:19,599 Speaker 1: the power. It's interesting, isn't it, how life turns? And 133 00:06:19,640 --> 00:06:22,599 Speaker 1: where once coal was hated and it needed to be 134 00:06:22,640 --> 00:06:25,839 Speaker 1: gotten rid of forthwith, and Huntley was a geriatric, old 135 00:06:25,839 --> 00:06:28,800 Speaker 1: facility that could be pushed into the river and never 136 00:06:28,880 --> 00:06:30,680 Speaker 1: to be thought of again. And yet all of a sudden, 137 00:06:30,720 --> 00:06:32,359 Speaker 1: look how reliant we are on it. 138 00:06:32,920 --> 00:06:35,800 Speaker 2: For more from the Mike Asking Breakfast, listen live to 139 00:06:35,920 --> 00:06:39,000 Speaker 2: news talks i'd Be from six am weekdays, or follow 140 00:06:39,040 --> 00:06:40,599 Speaker 2: the podcast on iHeartRadio.