WEBVTT - Andrew Bascand: Why do we have insufficient energy? 0:00:05.761 --> 0:00:09.441 You're listening to the Weekend Collective podcast from News Talks, 0:00:09.441 --> 0:00:09.721 it'd be. 0:00:11.401 --> 0:00:13.201 Don't lad when you're. 0:00:13.081 --> 0:00:14.321 Paying them more he's dragging? 0:00:14.401 --> 0:00:17.761 No, you're thinking about me when you're riding where he's drying? 0:00:17.841 --> 0:00:19.241 Now you missing mystery? 0:00:19.521 --> 0:00:19.681 Yeah? 0:00:19.761 --> 0:00:21.521 The time he close around me? 0:00:21.921 --> 0:00:24.601 Do you see when you're faith the more he's drinking. 0:00:24.681 --> 0:00:26.001 Now you thanking bout me? 0:00:26.401 --> 0:00:27.081 Coming bother? 0:00:27.281 --> 0:00:32.281 And n w's that sucking your job? Loud slaging, noise. 0:00:32.001 --> 0:00:34.561 Bosted big when you're feet his bad? 0:00:34.961 --> 0:00:36.361 Am I up in your head? 0:00:36.481 --> 0:00:38.801 Making you crazy? Tell me baby, are you. 0:00:38.841 --> 0:00:39.721 Thinking about me? 0:00:40.121 --> 0:00:43.761 Are you thinking about are you thanking bout when you 0:00:43.921 --> 0:00:44.561 say them more? 0:00:44.601 --> 0:00:45.161 He's dragging? 0:00:45.241 --> 0:00:45.361 Now? 0:00:45.361 --> 0:00:46.561 Are you thanking bound me? 0:00:47.281 --> 0:00:49.561 And welcome back to the Weekend Collective. Gosh, that was 0:00:49.921 --> 0:00:52.241 fascinating hour we just said with the health up. If 0:00:52.281 --> 0:00:55.281 you want to check out in the previous hours, then 0:00:55.321 --> 0:00:57.601 you can go and check out the podcast. Look for 0:00:57.641 --> 0:01:01.361 the Weekend Collective on iHeartRadio as you don't need to 0:01:01.401 --> 0:01:03.321 look any further for it. Really, we can go to 0:01:03.361 --> 0:01:05.881 the week on demand just news Talks website usually has 0:01:05.921 --> 0:01:09.721 the links as well. Anyway, right, it's time to move 0:01:09.761 --> 0:01:12.441 on to smart Money. We want your calls on n 0:01:12.921 --> 0:01:16.001 eighty ten eighty and text nine to nine to two, 0:01:16.641 --> 0:01:20.161 and we've got slightly different, slightly different angle on the 0:01:20.201 --> 0:01:22.841 money out today. We're joined by Andrew Baskin from Harbor 0:01:22.841 --> 0:01:24.601 Asset Management. Andrew, how are you. 0:01:24.641 --> 0:01:30.321 Going some really good wet down here today? But yeah, 0:01:30.441 --> 0:01:32.001 very wet, miserable. 0:01:33.241 --> 0:01:34.801 Yeah, But what I meant, wasn't it? 0:01:34.801 --> 0:01:37.681 It wasn't Bill great, terrific. It's got a great service 0:01:37.681 --> 0:01:38.321 to New Zealand. 0:01:38.521 --> 0:01:41.401 It is, It is impressive. Actually, in fact, I don't 0:01:41.441 --> 0:01:45.401 know if the financial I was thinking of the pharmaceutical 0:01:45.441 --> 0:01:48.521 side of things about how do you guys ever sort 0:01:48.521 --> 0:01:51.121 of is there any investment that goes on in New 0:01:51.201 --> 0:01:54.721 Zealand through the outside of the pharmaceutical companies into that 0:01:54.761 --> 0:01:57.161 sort of thing? Not at topic of conversation, but just 0:01:57.201 --> 0:01:58.881 by the way I. 0:01:58.921 --> 0:02:02.281 Thought I hit that because obviously anyone listening, you know, 0:02:02.521 --> 0:02:06.281 booked your on collogist first, not not your financial person 0:02:06.281 --> 0:02:08.561 if you've got a concern you're going cancer. But no, 0:02:08.801 --> 0:02:12.321 it's true, very true. But yes, there are two core 0:02:12.361 --> 0:02:16.681 companies that we've invested and we're still invested in Australia. Actually, 0:02:16.921 --> 0:02:20.601 one called Telix Pharmaceuticals, t e l i X go 0:02:20.681 --> 0:02:24.161 google that one, and that's a six billion dollar company. 0:02:24.201 --> 0:02:26.081 So that'd be if it was listed in New Zealand 0:02:26.121 --> 0:02:28.401 to be one of our top ten companies. And that 0:02:28.801 --> 0:02:35.721 specifically got a diagnostic a diagnostic indication for prostate cancer 0:02:36.201 --> 0:02:40.241 and kidney cancers and so hasn't yet got a fully 0:02:40.361 --> 0:02:43.441 a fully fledged therapeutical market that it's working on at 0:02:43.481 --> 0:02:46.641 stage three texts. And the other one is a coop 0:02:46.681 --> 0:02:51.001 of called mu tep im m U t e P. 0:02:51.761 --> 0:02:54.601 That's a half a billion dollar company, once again a 0:02:54.641 --> 0:02:58.401 aussy and that's working in this precision medicine are ss 0:02:58.441 --> 0:03:00.921 telics that Bill was talking about. So rather than this 0:03:01.121 --> 0:03:04.881 broad spread a chema that we're all familiar with, sadly, 0:03:06.001 --> 0:03:10.561 these companies are both working on precision medicine tillis and 0:03:10.681 --> 0:03:13.841 radio pharmaceuticals. And then you tip pretty much an area 0:03:13.841 --> 0:03:16.601 that Bill was talking about, and that's certainly where the 0:03:16.641 --> 0:03:19.801 science is going. Would all like it to go fast? Yeah, Bill, 0:03:19.841 --> 0:03:22.481 sort of right, These things take I thought. 0:03:22.801 --> 0:03:24.281 I thought from a financial point of view, it was 0:03:24.361 --> 0:03:26.321 eliminating because you know, we often hear a lot of 0:03:26.361 --> 0:03:29.481 stuff about pharmaceutical companies, but when you when you hear 0:03:29.841 --> 0:03:31.961 how much money is involved in the stage three trial. 0:03:32.521 --> 0:03:34.321 That's one hundred million bucks or something. I mean, there's 0:03:35.761 --> 0:03:38.401 it's a hell of a lot of money, isn't it. Anyway? 0:03:38.601 --> 0:03:40.641 I think has got three stage threes on it at 0:03:40.641 --> 0:03:42.481 the moment. You can only do that for your six 0:03:42.521 --> 0:03:45.601 billion dollar company, right So, and that's just a it's 0:03:45.641 --> 0:03:48.281 a very expensive thing to get involved. But new zid 0:03:48.281 --> 0:03:52.921 and scientists prominent in this area. You know, he was 0:03:53.001 --> 0:03:53.561 very modest. 0:03:53.961 --> 0:03:57.561 He was very modestically I had had to you know, 0:03:57.921 --> 0:04:00.401 he was very modest about his own achievements, of course, 0:04:00.441 --> 0:04:03.081 but you know, very generous to his colleagues who are 0:04:03.081 --> 0:04:05.881 still working. Hey, we've got a slightly I mentioned we've 0:04:05.881 --> 0:04:08.321 got a different tech not because not because we're chatting 0:04:08.361 --> 0:04:11.681 to you, but we're having a chat about the whole 0:04:11.761 --> 0:04:15.801 electricity picture with spiking costs over the last two weeks 0:04:16.281 --> 0:04:19.001 and the effect on businesses and what that means for 0:04:19.041 --> 0:04:23.401 the broader economy. And it's slightly it's potentially slightly political 0:04:23.561 --> 0:04:27.081 question too, isn't it, because of the way that electricity 0:04:27.641 --> 0:04:31.481 supply has been handled. What did you make of just 0:04:31.641 --> 0:04:35.641 first up, what did you make of these those prices 0:04:35.681 --> 0:04:39.881 and Shane Jones's comments about I think somebody there was 0:04:39.921 --> 0:04:42.601 an academic as well who said that our companies have 0:04:42.641 --> 0:04:45.441 been operating gen Taylor has been operating like a cartel. 0:04:45.841 --> 0:04:47.841 But anyway you kick. 0:04:47.721 --> 0:04:50.881 It off, Yeah, that's really I mean, if you're sitting 0:04:50.921 --> 0:04:52.401 at home, I mean, you're not going to see any 0:04:52.521 --> 0:04:54.241 change in your electricity bill, right, I mean, that's the 0:04:54.241 --> 0:04:58.001 first thing households, you know, no change in electricity bill. 0:04:58.041 --> 0:05:01.641 What we're really talking about is the wholesale market, the 0:05:01.681 --> 0:05:07.681 market for electricity between companies, large companies principally, and the 0:05:07.721 --> 0:05:10.281 Shock and Horror Show was and this is what kicked 0:05:10.281 --> 0:05:14.321 off the discussion, was that the price of wholesale interricy 0:05:14.401 --> 0:05:18.761 was around six times higher than it's been than it 0:05:18.801 --> 0:05:22.841 was last winter example, And it's like like June, July 0:05:23.321 --> 0:05:27.441 and into August, and that's when you know, the Minister 0:05:27.521 --> 0:05:30.561 sort of decided he had to say something. And I 0:05:30.561 --> 0:05:33.161 think it's really interesting because we could just simply say 0:05:33.721 --> 0:05:35.841 like it hasn't rained in the right places. We could 0:05:35.921 --> 0:05:39.121 just say that, and that's very true. I mean, our 0:05:39.321 --> 0:05:43.601 core lake levels up until Thursday or Friday might have changed. 0:05:43.641 --> 0:05:47.081 Now we're only at forty four or forty five percent 0:05:47.641 --> 0:05:50.921 of average. And this is a fun fact. I had 0:05:50.921 --> 0:05:55.841 to go, wait, look at actually our snowpack was similarly 0:05:56.321 --> 0:05:58.721 at a record low for this time of the year, 0:05:58.761 --> 0:06:02.361 a record low. Of course, the snow is the is 0:06:02.401 --> 0:06:06.001 the element that's going to create in our lakes. Later 0:06:06.201 --> 0:06:08.841 said stored energy. And the other thing that happened was 0:06:09.001 --> 0:06:12.081 we had a week here where the wind almost went 0:06:12.121 --> 0:06:16.681 to nothing as well. It's all three things combining meant 0:06:16.761 --> 0:06:20.641 that we had this shortage, this huge shortage of electricity 0:06:22.521 --> 0:06:25.401 to sort of you can't really blame it on the weather, 0:06:25.481 --> 0:06:26.201 in my opinion. 0:06:27.041 --> 0:06:29.801 It's a situation, isn't it, Because do you remember do 0:06:29.801 --> 0:06:31.441 you remember back on the I think I seem to 0:06:31.481 --> 0:06:33.841 remember that, remember when there was a problem with Auckland's 0:06:35.041 --> 0:06:38.641 levels in the dams and everything, and it led to 0:06:38.721 --> 0:06:41.481 the CEO resigning And a friend of mine said, you 0:06:41.521 --> 0:06:44.401 know what, if we'd simply had more more weather heads 0:06:44.401 --> 0:06:48.241 still have a job, so more rain. Sorry, And there's 0:06:48.321 --> 0:06:50.721 there is an element of that fickleness about it, isn't there. 0:06:50.801 --> 0:06:53.001 But of course, well then you. 0:06:52.961 --> 0:06:55.681 Asked us, why didn't we get ourselves set for this? 0:06:55.761 --> 0:06:58.761 So what I mean, that's the key question. And is 0:06:58.761 --> 0:07:01.241 it going to happen again? And I think you know, 0:07:01.601 --> 0:07:03.721 so those are the two questions you want to answer 0:07:04.121 --> 0:07:06.721 that we're all thinking of. And listeners will have their 0:07:06.761 --> 0:07:09.641 own views on this, and I'm interested in taking some notes. 0:07:09.681 --> 0:07:12.881 But look, I think this is my personal three key 0:07:12.961 --> 0:07:16.641 things that happened over the last five years that we 0:07:16.721 --> 0:07:19.681 got ourselves in a pickle. And this is controversial, but 0:07:19.841 --> 0:07:23.401 my view is that the whole discussion of project work 0:07:23.441 --> 0:07:29.921 around that huge abandoned onslow pumped hydro scheme terrific idea maybe, 0:07:30.041 --> 0:07:33.641 but the cost of its sixteen billion dollars, the fact 0:07:33.681 --> 0:07:37.161 that was going on meant that all of these big 0:07:37.241 --> 0:07:40.441 companies that generate eletricity for us said, oh no, I 0:07:40.521 --> 0:07:42.641 can't go ahead with our wind, can't go ahead of 0:07:42.641 --> 0:07:45.281 that new solar, not going to do a big battery project, 0:07:45.321 --> 0:07:48.401 not going to be more geofilmal because we're thinking about 0:07:48.521 --> 0:07:51.521 as a country putting in I think a thousand megawatts 0:07:51.521 --> 0:07:54.441 of capacity. Is it like like a twelve to fifteen 0:07:54.441 --> 0:07:56.681 percent increase in our capacity? So if that was going 0:07:56.721 --> 0:07:58.161 to happen, well we're not going to go do it. 0:07:58.241 --> 0:08:02.041 So that that's the way we approach that project I 0:08:02.081 --> 0:08:02.681 think was wrong. 0:08:05.081 --> 0:08:11.161 Actually, what we're really in it it's it does quickly 0:08:11.241 --> 0:08:13.601 end up being a political question, isn't it, Because if 0:08:13.641 --> 0:08:18.561 it went for if it went for that project dominating 0:08:18.601 --> 0:08:22.241 the landscape, would we be in the trouble that we're 0:08:22.241 --> 0:08:25.041 in because would we have managed and build the infrastructure 0:08:25.121 --> 0:08:27.081 or do you think that's I. 0:08:27.041 --> 0:08:30.881 Don't think that's the only thing that And so there's two 0:08:30.921 --> 0:08:32.601 other things that were going on at the same time. 0:08:32.921 --> 0:08:35.121 There was a shortage. There's been a shortage of gas. 0:08:35.161 --> 0:08:38.801 We all know why that happened. We stopped exploring for it, 0:08:38.841 --> 0:08:42.521 and it's another political decision we made. But that shortage 0:08:42.521 --> 0:08:46.401 of gas means that in the in a dry, cold 0:08:46.601 --> 0:08:49.961 winter where the wind doesn't blow, we just don't have 0:08:50.081 --> 0:08:54.521 enough gas to turn on those big plants that creates 0:08:54.561 --> 0:08:56.521 the electricity when there's no water. 0:08:57.041 --> 0:08:59.001 We need more gas, don't we. 0:08:59.001 --> 0:09:01.961 Well, well, well, actually this is the thing. I'll come 0:09:02.001 --> 0:09:04.601 to this. I'm not sure we do. I'll come to this. 0:09:04.801 --> 0:09:09.481 But we just didn't have any. And the third thing 0:09:09.641 --> 0:09:13.721 is we had this sword hanging over us with real 0:09:13.761 --> 0:09:18.121 tinto do they stay, do they go? And can we 0:09:18.321 --> 0:09:22.841 elicit from them a demand response if we need their 0:09:22.881 --> 0:09:25.721 electricity back again, and we sort of, oh, we want 0:09:25.761 --> 0:09:28.481 we want to sort out these things. And so these 0:09:28.521 --> 0:09:32.561 things all came together to sort of mean that we 0:09:32.721 --> 0:09:37.561 sort of stopped producing investment proposals to put in more 0:09:37.601 --> 0:09:39.601 wind more. So, I think. 0:09:40.801 --> 0:09:44.641 It does seem to me that one plus one plus one, well, 0:09:44.761 --> 0:09:46.361 I guess I say one plus one. But what you're 0:09:46.361 --> 0:09:50.081 saying is, and it's a surprisingly sort of political angle 0:09:50.081 --> 0:09:52.561 to this hour and away. But if the Labor government 0:09:52.601 --> 0:09:56.401 hadn't announced all its plans for Onslow, would we have 0:09:56.481 --> 0:09:59.641 the problems that we've got. And I know you don't 0:09:59.681 --> 0:10:03.081 like to play it politically, that that seemed to me 0:10:03.121 --> 0:10:04.841 that they ballsed it up completely. 0:10:06.681 --> 0:10:08.521 Well, the thing is, I think the way you present 0:10:08.561 --> 0:10:11.881 the idea is the first thing you know, it was 0:10:12.001 --> 0:10:13.921 always just going to be who's going to do this? 0:10:14.001 --> 0:10:16.121 Is just going to government, was going to be participation, 0:10:16.241 --> 0:10:19.561 and the size of the project was such that it 0:10:19.681 --> 0:10:22.681 was going to dominate the eletricity sector. But it wasn't 0:10:22.681 --> 0:10:27.041 the only issue. And I think by itself probably would 0:10:27.041 --> 0:10:30.641 have still seen some I think some generation put in 0:10:30.721 --> 0:10:33.761 it over time. But we had the other two factors 0:10:34.201 --> 0:10:37.001 creating a lot of uncertainty in my opinion. But there's 0:10:37.041 --> 0:10:40.641 the good news sit here now today we're sort of 0:10:40.681 --> 0:10:43.601 solved all three, have we We've solved all three well. 0:10:43.801 --> 0:10:45.641 And this is this is the really interesting thing we 0:10:45.761 --> 0:10:50.801 learned last week that I think is probably something we're 0:10:50.841 --> 0:10:53.161 just waking up to. So the good news is there's 0:10:53.201 --> 0:10:58.161 now three terror what that's like seven percent of our 0:10:58.161 --> 0:11:01.641 electricity generation being built today. That's being built so in 0:11:01.721 --> 0:11:05.601 solar wind batteries and that's happening today. So we've made 0:11:05.601 --> 0:11:08.441 our mind up where they are building. But that doesn't 0:11:08.441 --> 0:11:12.801 help today tomorrow electricity. But this is what it does. 0:11:13.161 --> 0:11:17.641 When they renegotiated that Rio Tinto contract, they are allowed 0:11:18.041 --> 0:11:21.841 the potential to pull a ripcord a few times, not 0:11:21.841 --> 0:11:24.441 not every month, but a few times, pull a ripcord 0:11:24.961 --> 0:11:28.601 and give us back four percent of New Zealand's electricity 0:11:28.961 --> 0:11:31.281 at the right price. Is it constant doing that? So 0:11:31.321 --> 0:11:34.481 we pulled the rip cord, I forget twenty days ago, 0:11:35.721 --> 0:11:37.921 and I don't think, you know, we all work up 0:11:37.921 --> 0:11:40.641 to the fact that we so that electricity now right 0:11:40.681 --> 0:11:44.121 now is beginning to come back into our grid, and 0:11:44.281 --> 0:11:46.601 it comes back for like a month or two and 0:11:46.641 --> 0:11:50.361 then gradually we'll give it back to the That's pretty good. 0:11:51.281 --> 0:11:54.321 That's that's happening. But here's the news that happened last week. 0:11:55.521 --> 0:11:59.081 The method X are plants sitting out there in Karanaki 0:12:00.201 --> 0:12:03.441 made a decision, in conjunction with Contact Energy and Genesis 0:12:03.441 --> 0:12:06.601 to shutter, not not to close permanently, but the word shutter, 0:12:06.641 --> 0:12:08.761 I think I now know what it means. It means, well, 0:12:08.961 --> 0:12:11.681 let's close this down to some maintenance and we're not 0:12:11.681 --> 0:12:15.601 going to use our gas. So the gas response now 0:12:15.721 --> 0:12:20.081 means that Contact and Genesis will be able to grab 0:12:20.121 --> 0:12:23.681 that gas and turn on their their peak of plants, 0:12:23.681 --> 0:12:26.561 their plants to that we use if it doesn't rain. 0:12:26.881 --> 0:12:28.481 There's no where who drive that decision? 0:12:29.161 --> 0:12:33.121 Well, that's very interesting. Must have happened behind behind some 0:12:33.161 --> 0:12:36.441 closed doors somewhere. I think it was probably a commercial decision. 0:12:37.681 --> 0:12:42.921 It wouldn't surprise me if just the three companies decided, well, 0:12:44.121 --> 0:12:48.201 let's let's make a commercial decision that's right for everyone, 0:12:48.481 --> 0:12:51.241 right for the clients of Contact and Genesis, right for 0:12:51.281 --> 0:12:53.201 Methodics at the right price. I mean I think there'd 0:12:53.201 --> 0:12:57.241 be money, money, money changes hands. He clearly, and it's 0:12:57.241 --> 0:12:59.721 a good commercial decision and it's actually the right thing 0:12:59.721 --> 0:13:03.121 for Contact clients Genesis in the country. 0:13:03.281 --> 0:13:05.401 All they went when I mean the critics, some of 0:13:05.401 --> 0:13:08.121 the gentailers, but they were just charging like wounded bulls, 0:13:08.121 --> 0:13:10.161 and so they were making money regardless of where they 0:13:10.161 --> 0:13:13.641 got it from. So the incentive to them to spend 0:13:13.841 --> 0:13:17.081 money give some money to methodics. What would the incentive 0:13:17.081 --> 0:13:20.521 for them have been simply restore restoration of their reputations 0:13:20.561 --> 0:13:24.761 and getting on top of the challenges they've got or what. 0:13:24.921 --> 0:13:27.481 Well, the last thing Contact and Genesis want is to 0:13:27.601 --> 0:13:32.361 have more opinion. Industrial plants closing down in New Zealand 0:13:32.401 --> 0:13:36.121 because we can't provide electricity at the right price. Don't 0:13:36.121 --> 0:13:40.201 forget that these guys are competing with each other, and 0:13:40.521 --> 0:13:44.281 they're very happy to sell electricity at one hundred and 0:13:44.281 --> 0:13:47.881 fifty one hundred and forty dollars when the cost of 0:13:47.881 --> 0:13:50.081 producing it's going to be one hundred and twenty hundred 0:13:50.081 --> 0:13:52.961 and twenty five dollars. They don't need electricity to be 0:13:53.721 --> 0:13:55.961 six hundred dollars, eight hundred dollars, and in fact, that's 0:13:56.081 --> 0:13:59.041 very harmful, very harmful for their businesses. 0:13:59.321 --> 0:14:01.641 Well, let's just talk about that in terms of what 0:14:01.681 --> 0:14:04.441 effect it really had on because, as you say, it 0:14:04.481 --> 0:14:08.681 doesn't affect the average home owner. Of course, we've all 0:14:08.681 --> 0:14:11.721 got fixed, we've got our deals with which whatever they are, 0:14:12.921 --> 0:14:16.921 impenetrable though they may be to understand. But what was 0:14:16.961 --> 0:14:20.041 the effect on the economy? 0:14:20.841 --> 0:14:24.041 Yeah, sadly, sadly. I mean there were quite a few 0:14:24.041 --> 0:14:29.481 businesses that shuttered themselves. Don't know whether they that they 0:14:29.761 --> 0:14:33.561 will see the opportunity to start up again when electricity 0:14:33.601 --> 0:14:35.641 prices come back, and by the way, they have started 0:14:35.641 --> 0:14:39.601 to come back quite sharply. And the people, of course 0:14:39.721 --> 0:14:43.721 work in those plants, and that's the demand response that occurs. 0:14:43.761 --> 0:14:47.841 And now Rio Tinto's providing that demand response. Well, hopefully 0:14:47.881 --> 0:14:52.241 that will release the electricity back to other industrial users. 0:14:52.681 --> 0:14:56.881 I mean, you sort of can't. You can't use electricity. 0:14:56.921 --> 0:14:58.321 You're not you're not making So we had to make 0:14:58.361 --> 0:15:00.921 a chure somewhere. Their households turn off their hot water 0:15:01.321 --> 0:15:04.961 or they're heating, but the school's close or hospitals close. 0:15:05.281 --> 0:15:07.241 What do you do in the country, So you need 0:15:07.321 --> 0:15:10.081 a demand response when something like this happens. The key 0:15:10.081 --> 0:15:11.801 thing for us is we don't want this to happen again, 0:15:11.921 --> 0:15:17.001 so we need to have mechanisms that think ahead with 0:15:17.001 --> 0:15:20.001 respect to snow, rain and wind. 0:15:20.401 --> 0:15:24.001 So we're still reactive, aren't we We're not. Is there 0:15:24.001 --> 0:15:26.321 a chance we're going to become more proactive? 0:15:26.521 --> 0:15:31.041 From you? We're absolutely getting there. I said before. We've 0:15:31.081 --> 0:15:35.041 got seven percent new brand new KIP going in right now, 0:15:35.161 --> 0:15:41.321 across wind, across solar, across batteries, across geo thermal. It's 0:15:41.321 --> 0:15:44.201 seven percent new kit going in, which. 0:15:44.081 --> 0:15:46.881 Is pretty that's seven sounds like a small number. See, 0:15:46.881 --> 0:15:47.641 it's actually quite. 0:15:47.481 --> 0:15:50.961 A ch This is billions of dollars of investment. This 0:15:51.041 --> 0:15:54.081 isn't like one hundred million dollars. This is billions of 0:15:54.121 --> 0:15:58.241 dollars of investments. Now. The other thing is Content Energy 0:15:58.601 --> 0:16:01.841 has just started a fire up for their Tollhard a 0:16:01.961 --> 0:16:04.641 new geo thermal plant that went on the ground to 0:16:04.641 --> 0:16:08.321 stead of four years ago. Turn the first side, and 0:16:08.401 --> 0:16:10.721 that's taken a bit longer to going. It's about seventy 0:16:10.721 --> 0:16:13.761 percent up now. That's about four percent three or four 0:16:13.801 --> 0:16:17.721 percent new electricity by itself. So that's a good that's 0:16:17.721 --> 0:16:20.201 a good story. We probably need two or three more 0:16:20.201 --> 0:16:23.441 of those, because of course it doesn't matter with your 0:16:23.481 --> 0:16:31.641 thermore if there's no water and no sunshine or no wind, 0:16:32.001 --> 0:16:35.841 the pipe stool being heated a klumbit of beneath the 0:16:36.361 --> 0:16:36.961 beneath the earth. 0:16:37.841 --> 0:16:41.561 Yeah, so what what what do you think that? What? 0:16:41.561 --> 0:16:44.081 What further investments do we do we sort of need 0:16:44.081 --> 0:16:46.201 from here so we don't see this sort of thing 0:16:46.201 --> 0:16:48.561 happening again. And what stage is that at? 0:16:50.241 --> 0:16:58.161 Yeah, there are there's another ten percent electricity potential supply 0:16:59.721 --> 0:17:03.921 on a schedule going out to twenty thirty These are 0:17:03.961 --> 0:17:08.961 projects that very again from large scale solar plus batteries 0:17:09.241 --> 0:17:13.561 attached to them, to wind plus batteries, to a significant 0:17:13.641 --> 0:17:20.801 extension of existing geothermal assets. And this excludes possibly some 0:17:20.881 --> 0:17:24.121 pumped hydro projects that aren't on the schedule at the moment. 0:17:25.241 --> 0:17:28.001 And when I'm looking at all less and if I 0:17:28.041 --> 0:17:31.401 add all that up, unless the economy here starts scaring 0:17:31.441 --> 0:17:36.001 both three or four percent, we could seriously get into 0:17:36.041 --> 0:17:41.281 the position where we have too much electricity, and you 0:17:41.321 --> 0:17:45.601 know that would be misallocation of resources. However, and this 0:17:45.681 --> 0:17:47.321 is the point I'm making regard to do any gas 0:17:47.401 --> 0:17:49.561 or not we need it now, We probably need it 0:17:49.961 --> 0:17:52.681 through to about twenty thirty five, and we probably need 0:17:52.721 --> 0:17:56.241 to learn how to store gas, you know, store gas. 0:17:56.721 --> 0:18:01.481 But yeah, No, I'm pretty optimistic that will work our 0:18:01.521 --> 0:18:02.041 way through this. 0:18:02.401 --> 0:18:05.481 So, yeah, it's because a lot of the talkers that 0:18:05.521 --> 0:18:08.841 you know, we import of this coal to burn and 0:18:09.001 --> 0:18:11.201 tough times, and you know we haven't. We're not drilling 0:18:11.201 --> 0:18:16.241 for more gas and things do you So where are 0:18:16.241 --> 0:18:19.321 you at with that in terms of what the politicians 0:18:19.321 --> 0:18:20.321 say about the need for it. 0:18:20.361 --> 0:18:22.961 Well, first of all, it's an absolutely dreadful outcome that 0:18:23.041 --> 0:18:25.161 trucks and trucks and tracks are going down the main 0:18:25.241 --> 0:18:28.681 road there to Huntly full of coal that isn't from 0:18:28.721 --> 0:18:31.721 New Zealand under Lett alone, you know, being shipped to 0:18:31.841 --> 0:18:34.401 New Zealand from sure that we just want to cease 0:18:34.441 --> 0:18:40.121 that activity as fast as possible. So it's the first thing. Secondly, 0:18:40.201 --> 0:18:43.401 gas has to be that, in my opinion, that last 0:18:43.481 --> 0:18:47.001 transition fuel at the moment, and by the last, I 0:18:47.001 --> 0:18:50.521 mean we can get ninety renewable, ninety six renewable, I 0:18:50.561 --> 0:18:54.361 think we're still going to sit on three to four percent. Yeah, 0:18:54.401 --> 0:18:54.921 sitting here. 0:18:54.841 --> 0:18:57.841 In gas, it seems that unless you're being completely idealistic, 0:18:59.801 --> 0:19:03.561 you know, naively, then ninety five percent renewable, great, but 0:19:03.601 --> 0:19:05.881 the last five percent were still going to need to 0:19:05.921 --> 0:19:08.761 have that spere well. Posie. 0:19:09.881 --> 0:19:13.321 I'm a bit more optimistic that we will find other 0:19:14.041 --> 0:19:17.321 other means of generating energy. And h I think there's 0:19:17.321 --> 0:19:20.521 probably more geothermal assets in museum we haven't fully explored. 0:19:21.641 --> 0:19:25.481 Pretty prey optimistic. We sit, unlike many countries around the world, 0:19:25.561 --> 0:19:31.361 close to the Earth's crust and that that technology is. 0:19:31.881 --> 0:19:33.241 You know, we know how to do that stuff. We've 0:19:33.281 --> 0:19:36.881 got great engineers and scientists in New Zealand who are 0:19:36.921 --> 0:19:40.681 world leading and how to extract the energy. So you know, 0:19:40.721 --> 0:19:46.241 I'm not that pessimistic about our capacity to use. 0:19:47.161 --> 0:19:50.321 We got to take some calls as well, So let's 0:19:50.361 --> 0:19:52.321 go to what's the time and tell you what. We'll 0:19:52.361 --> 0:19:53.681 take a break. We'll come back with a call from 0:19:53.681 --> 0:19:59.201 Peter in just a moment. Are you actually I think, 0:19:59.401 --> 0:20:01.521 just to sum it up, you're quite optimistic that we're 0:20:01.521 --> 0:20:04.641 not doing too badly now, despite the catastrophic sort of headlines. 0:20:04.721 --> 0:20:06.881 Andrew, I think if you understand how we got till 0:20:06.921 --> 0:20:09.721 we got to, if you want to jump in and 0:20:09.721 --> 0:20:14.321 create an intervention now, I think that could only add 0:20:14.481 --> 0:20:19.001 add to the noise and and and cease the current 0:20:19.081 --> 0:20:22.321 path we're on, which finally, I think I think we're 0:20:22.361 --> 0:20:25.321 generally speaking, on the right path, generally speaking. 0:20:25.441 --> 0:20:27.641 Okay, cool, right, we'll take a break. Come back from 0:20:27.641 --> 0:20:31.081 just a moment. Oh one eighty text nine. It's twenty 0:20:31.121 --> 0:20:53.281 seven past five News Talks. He'd be and welcome back 0:20:53.281 --> 0:20:56.121 to the Weekend collective. This is Smart Money with and 0:20:56.561 --> 0:20:58.881 My guest is Andrew bask And he's managing director of 0:20:58.881 --> 0:21:01.561 portfolio manager at harbor Asset Management. You want to check 0:21:01.561 --> 0:21:04.681 out their their work and there it's harbor Asset dot 0:21:04.721 --> 0:21:09.201 cod z. We're talking about something slightly different in terms 0:21:09.241 --> 0:21:12.121 of electricity to supply, but simply because of the effect 0:21:12.161 --> 0:21:16.081 it had on businesses around the country. And Andrew, it's 0:21:16.081 --> 0:21:17.681 fair to say, before we go to our first caller, 0:21:17.761 --> 0:21:19.881 you are reasonably optimistic that we're getting on top of 0:21:19.881 --> 0:21:22.361 this thing now despite all the political noise about NEEDA 0:21:22.441 --> 0:21:24.241 to drill more gas and all that sort of stuff. 0:21:25.041 --> 0:21:27.681 I mean, you can't, you can't overnight build a whole 0:21:27.681 --> 0:21:33.881 lot more kit. Right, We now have a possibility that 0:21:33.961 --> 0:21:38.241 within three or four years will have certainly different configuration 0:21:38.361 --> 0:21:40.521 of the kit. The key thing that's changed is this 0:21:40.561 --> 0:21:44.481 demand response from Rio tinto museum Alement themselves and methnics 0:21:44.841 --> 0:21:49.521 on the gas, and that has created a capacity to 0:21:49.521 --> 0:21:50.961 put more energy into the system. 0:21:51.121 --> 0:21:55.201 Right, let's take some calls. Peter, Hello, good morning. 0:21:55.601 --> 0:22:00.121 Andrew didn't mention how Australia intervened in their market, and 0:22:00.161 --> 0:22:02.281 it's no longer a free market as I understand where 0:22:02.281 --> 0:22:06.681 it's a New Zealand response was sort of a market response. 0:22:06.721 --> 0:22:09.481 But I just wondered, you know, where is all this 0:22:09.561 --> 0:22:13.521 guess going to come from? You know, if New Zealand 0:22:13.641 --> 0:22:17.721 does want to have guess available for four dry years. 0:22:17.721 --> 0:22:21.761 And the other question I have is how competitive are 0:22:22.281 --> 0:22:25.881 electricity prices when we look, we'll pay fifteen percent is 0:22:25.961 --> 0:22:30.521 to pay a mission trading scheme system plus you know 0:22:30.601 --> 0:22:34.481 bank charges on credit card transactions, plus on top of 0:22:34.521 --> 0:22:37.841