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Speaker 1: Jeremy Hutton, Milford Acid Managements with us.

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Speaker 2: Hey, Jeremy, good evening, Heather.

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Speaker 1: Were you surprised by the fact that there was a

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Speaker 1: twenty year deal with Typoint.

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Speaker 2: Yeah, it was the news that everyone who follows the

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Speaker 2: New Zealand electricity sector had been waiting for eagerly, and

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Speaker 2: it was a positive, positive news. And yes, the deal

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Speaker 2: length was a surprise. So Meridian Energy, who is the

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Speaker 2: primary negotiator, had requested a longer deal than the normal

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Speaker 2: or the previous three yearly deal cycle, and Rio Tinto,

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Speaker 2: who's the owner of the smelter, liked to play hardball

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Speaker 2: around the shorter timing in the past, so effectively, Meridian

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Speaker 2: was seeking the longer term, a more meaningful deal and

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Speaker 2: something that it gives a sector more opportunity to invest

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Speaker 2: long term and of course give the local community done

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Speaker 2: in South lond and more certainly around jobs and opportunities

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Speaker 2: as well.

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Speaker 1: What do you reckon this means for new renewable projects

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Speaker 1: in the country. Will more of them get built?

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Speaker 2: Yeah? It should be a large positive for new renewable

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Speaker 2: builds in New Zealand and the ty smelter is a

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Speaker 2: really large user of electricity in the country around twelve

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Speaker 2: to thirteen percent of total electricity demand, and if the

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Speaker 2: smelter had exited, it would have left the electricity market

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Speaker 2: and a heavy oversupply, and this incentive to build for

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Speaker 2: developers would have been gone probably for the rest of

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Speaker 2: this decade.

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Speaker 1: And a smell to exit would have impacted our country's

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Speaker 1: electrification plans.

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Speaker 2: Do you think, yeah, my viewer would have. It would

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Speaker 2: have impacted our ability to decarbonize and electrify materially. I mean,

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Speaker 2: we do as a country need to produce a lot

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Speaker 2: more electricity to meet our total country carbon commitment goals.

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Speaker 2: And the gentailers and other developers have been building a

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Speaker 2: large amount of view generation already, mainly on the back

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Speaker 2: of growing demand from things like electric vehicles and data

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Speaker 2: centers that we know. But now the gentailers and other

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Speaker 2: developers will be you know, they have that certainty to

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Speaker 2: commit to more generation and they are long term projects,

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Speaker 2: so they need that certainty. And there are some great

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Speaker 2: wind projects that I think will kick off on the

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Speaker 2: back of this, particularly down in the Deep South were

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Speaker 2: there is some great resource. Unfortunately it's really close to

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Speaker 2: large users like the Tey smelter as well.

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Speaker 1: That's good stuff and what happened to the share prices

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Speaker 1: of the gen Taylor's.

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Speaker 2: Yeah, the size of the positive reaction was a surprise

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Speaker 2: to me. I mean, the market had been anticipating a

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Speaker 2: ty Stay deal as likely, so part of the good

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Speaker 2: news was factored in already. But there is always some

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Speaker 2: risk that the exit scenario could play out, and that

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Speaker 2: was in the price a little bit too, Albeit it

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Speaker 2: was small in this instance. So you saw a small

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Speaker 2: pop of between three and five percent for the big

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Speaker 2: three gent tailors, so Meridy and Mercury and Contact. But

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Speaker 2: there was always also a bit of other action. On

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Speaker 2: that day, there was a large passive index rebalancing event,

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Speaker 2: and that generally happens on the last trading month of

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Speaker 2: the last trading day of the month, and these passive

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Speaker 2: funds tend distort the market a little bit. When that

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Speaker 2: hit in the last hour, those share prices took another

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Speaker 2: leg up and Meridian finished up ten percent on the day,

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Speaker 2: which is really a few move for a steady gin

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Speaker 2: Taylor like Meridian.

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Speaker 1: I tell you what. Jeremy, thank you, Jeremy Hutton, Milford

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Speaker 1: Asset Management. Hey have you with one of the mum

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Speaker 1: and dad in Vistas buying into these companies when the

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Speaker 1: country sold down, Chuch hang good move from you. For

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Speaker 1: more from Hither Duplessy Allen Drive, listen live to news

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