1 00:00:00,080 --> 00:00:02,160 Speaker 1: Now a big turnaround for one of our gent tailors. 2 00:00:02,480 --> 00:00:04,960 Speaker 1: Meridians posted a first half net profit of two hundred 3 00:00:04,960 --> 00:00:07,360 Speaker 1: and twenty seven million dollars. That's compared with one hundred 4 00:00:07,360 --> 00:00:10,080 Speaker 1: and twenty one million dollar loss in the corresponding period 5 00:00:10,160 --> 00:00:12,520 Speaker 1: last year. Mike grown is the chief executive. 6 00:00:12,560 --> 00:00:14,120 Speaker 2: Hi, Mike hey Ema. 7 00:00:14,360 --> 00:00:16,880 Speaker 1: This is basically this massive turnarounds basically down to rain, 8 00:00:16,960 --> 00:00:18,759 Speaker 1: isn't it. 9 00:00:18,760 --> 00:00:21,080 Speaker 2: It's certainly a strong result, and it helps when you've 10 00:00:21,079 --> 00:00:25,640 Speaker 2: got supportive environmental conditions. Mother nature has certainly come to party. 11 00:00:25,880 --> 00:00:28,479 Speaker 1: Yeah. Does it worry you that that things can turn 12 00:00:29,240 --> 00:00:32,040 Speaker 1: can swing so wildly from one side to the other, 13 00:00:32,320 --> 00:00:33,879 Speaker 1: just based on rain for your business. 14 00:00:34,720 --> 00:00:37,800 Speaker 2: Oh, the events we saw last year are really unusual, 15 00:00:38,200 --> 00:00:41,480 Speaker 2: you know, the combination of a drought with unexpected loss 16 00:00:41,479 --> 00:00:45,000 Speaker 2: of gas supply. You know, the events this year certainly 17 00:00:45,000 --> 00:00:48,120 Speaker 2: more rain that we expect, but on average, you know, 18 00:00:48,360 --> 00:00:50,879 Speaker 2: we tend to have plenty of rain and wind to 19 00:00:50,920 --> 00:00:55,200 Speaker 2: power the electricity system. So you know, I'd expect more 20 00:00:55,240 --> 00:00:58,240 Speaker 2: results like you've seen this year than you know, the 21 00:00:58,280 --> 00:00:59,520 Speaker 2: one that you saw last year. 22 00:01:00,240 --> 00:01:02,680 Speaker 1: I mean, the loss of gas is obviously going to 23 00:01:02,680 --> 00:01:05,120 Speaker 1: be the future for us. So is this what it 24 00:01:05,160 --> 00:01:07,039 Speaker 1: looks like is last year what it looks like every 25 00:01:07,040 --> 00:01:12,120 Speaker 1: time we have a drought year for you. 26 00:01:10,240 --> 00:01:14,199 Speaker 2: No, So what we did after the drought is we 27 00:01:15,000 --> 00:01:18,000 Speaker 2: went out and looked at how we both stabilized security 28 00:01:18,560 --> 00:01:24,360 Speaker 2: and manage affordability while risk for shareholders, and we completed 29 00:01:24,440 --> 00:01:30,840 Speaker 2: the Strategic Energy Reserve huntly and that transaction allows us 30 00:01:30,880 --> 00:01:34,120 Speaker 2: to shore up the business during drought materially. 31 00:01:34,760 --> 00:01:36,759 Speaker 1: Now what's the plan with hydro development? 32 00:01:38,800 --> 00:01:44,160 Speaker 2: Well, really early days. You know, I'm pretty excited by it. 33 00:01:44,360 --> 00:01:50,040 Speaker 2: First time in thirty years that we've looked at hydro development. 34 00:01:50,160 --> 00:01:54,440 Speaker 2: But the reason I'm excited is if we can find 35 00:01:54,480 --> 00:01:58,320 Speaker 2: a way to store more water, then you know, we 36 00:01:58,360 --> 00:02:04,200 Speaker 2: can generate more of the electricity from hydro, which will 37 00:02:04,200 --> 00:02:07,480 Speaker 2: bring the average price of energy down. The challenges it 38 00:02:07,480 --> 00:02:09,960 Speaker 2: will take us time to get there, and you know 39 00:02:10,000 --> 00:02:13,400 Speaker 2: we're in early days now looking at what we can do. 40 00:02:13,480 --> 00:02:15,760 Speaker 1: I mean, you're not talking about building a new damn, 41 00:02:15,800 --> 00:02:17,960 Speaker 1: are you? You're talking about lifting a lake level. 42 00:02:18,800 --> 00:02:22,680 Speaker 2: That's exactly right. We're looking at two Kaki dam and 43 00:02:22,919 --> 00:02:24,840 Speaker 2: we're looking at what we might be able to do 44 00:02:24,960 --> 00:02:29,280 Speaker 2: to lift that damn. While engineering wise, you know that 45 00:02:29,320 --> 00:02:31,240 Speaker 2: can all be done. So there's no question that the 46 00:02:31,280 --> 00:02:34,000 Speaker 2: engineering can be done. The question that I've asked the 47 00:02:34,040 --> 00:02:37,639 Speaker 2: team is is it economic to do it? So? Does 48 00:02:37,639 --> 00:02:41,960 Speaker 2: it actually make financial sense to expand the amount of 49 00:02:42,200 --> 00:02:44,880 Speaker 2: hydro storage that we've got within the company, And you 50 00:02:44,960 --> 00:02:48,160 Speaker 2: know that the country would have to manage the swings 51 00:02:48,160 --> 00:02:50,120 Speaker 2: and roundabouts, so the weather, what is it? 52 00:02:50,520 --> 00:02:52,280 Speaker 1: What are you weighing up there? Are you weighing up 53 00:02:52,320 --> 00:02:53,360 Speaker 1: the cost of doing this? 54 00:02:54,360 --> 00:02:55,560 Speaker 2: Yes, that's exactly right. 55 00:02:56,280 --> 00:02:58,240 Speaker 1: Tell me if I'm wrong here. But my understanding of 56 00:02:58,240 --> 00:03:00,600 Speaker 1: this is, like, you know, normal puntline me would think, 57 00:03:00,639 --> 00:03:02,760 Speaker 1: oh the sweet as you just lift the level, you 58 00:03:02,880 --> 00:03:05,280 Speaker 1: just hold more. But it's not as simple as that, 59 00:03:05,360 --> 00:03:07,280 Speaker 1: is it. Like there's a significant amount of construction that 60 00:03:07,320 --> 00:03:07,880 Speaker 1: you would need. 61 00:03:08,800 --> 00:03:12,239 Speaker 2: Yeah, you need so there is a little more water 62 00:03:12,320 --> 00:03:14,480 Speaker 2: that we could store, and we're looking carefully at that 63 00:03:14,480 --> 00:03:19,920 Speaker 2: without expanding the dam structure, but to store the amount 64 00:03:19,919 --> 00:03:24,360 Speaker 2: of water that the country really would need to both 65 00:03:24,360 --> 00:03:27,640 Speaker 2: help electrify and manage you know, a dry year in future. 66 00:03:27,800 --> 00:03:30,080 Speaker 2: Is you know you're talking a lift in that dam 67 00:03:30,200 --> 00:03:33,440 Speaker 2: of I'll say between five and fifteen meters, So it's 68 00:03:33,600 --> 00:03:37,840 Speaker 2: quite a substantial effort in a rebuild of that dam. Structure, 69 00:03:37,920 --> 00:03:40,920 Speaker 2: So you know, you're probably talking billions of dollars to 70 00:03:40,960 --> 00:03:41,240 Speaker 2: do that. 71 00:03:41,560 --> 00:03:43,920 Speaker 1: Would you be prepared to fund it yourself as a company? 72 00:03:44,880 --> 00:03:46,600 Speaker 2: Oh yeah, you know, like if we can see the 73 00:03:46,640 --> 00:03:50,400 Speaker 2: economic opportunity, then you know, I doubt we'll have any 74 00:03:50,440 --> 00:03:51,800 Speaker 2: problem funding it. 75 00:03:52,200 --> 00:03:53,920 Speaker 1: What about I mean, is this going to flip the 76 00:03:53,920 --> 00:03:54,600 Speaker 1: greenees out? 77 00:03:56,520 --> 00:04:00,320 Speaker 2: Now? The beauty with Poukak is it's a modified hydro 78 00:04:00,320 --> 00:04:03,480 Speaker 2: attatchment and there are very few people that live around it. 79 00:04:03,520 --> 00:04:04,960 Speaker 2: And so when I say modivate. 80 00:04:04,840 --> 00:04:07,600 Speaker 1: Sales, though, Mike, have we got snails or skinks of 81 00:04:07,680 --> 00:04:08,400 Speaker 1: stuff like that? 82 00:04:09,280 --> 00:04:13,400 Speaker 2: We don't know. That's when I say modified hydro attatchment, 83 00:04:13,480 --> 00:04:17,640 Speaker 2: I really mean that the environmental impact of both raising 84 00:04:17,760 --> 00:04:22,120 Speaker 2: and lowering that lake is really limited because it's already 85 00:04:22,200 --> 00:04:26,640 Speaker 2: got a fourteen meter operating range, so there's not a 86 00:04:26,680 --> 00:04:30,320 Speaker 2: massive environmental impact and you're not impacting people who would 87 00:04:30,320 --> 00:04:34,719 Speaker 2: otherwise live around the facility. The real question is can 88 00:04:34,760 --> 00:04:37,680 Speaker 2: we make the economics stack up? And I don't have 89 00:04:37,839 --> 00:04:40,159 Speaker 2: the answer to that. So at the moment, it's a 90 00:04:40,160 --> 00:04:43,839 Speaker 2: bit of a dream, but it's one worth pursuing because 91 00:04:44,720 --> 00:04:48,000 Speaker 2: if we can deliver it, then you know, we drive 92 00:04:48,240 --> 00:04:51,000 Speaker 2: a structural advantage for the New Zealand economy visa the 93 00:04:51,040 --> 00:04:54,960 Speaker 2: Australia or the US, or Europe or Asia because they 94 00:04:55,000 --> 00:04:58,159 Speaker 2: don't have access to water like we do, and we 95 00:04:58,200 --> 00:05:01,520 Speaker 2: can have a lower price for energy, your electricity than 96 00:05:01,560 --> 00:05:05,360 Speaker 2: they would ever hope to experience, which helps her export US. Yeah. 97 00:05:05,360 --> 00:05:07,240 Speaker 1: I'm really interested to see how this goes, Mike, thanks 98 00:05:07,240 --> 00:05:09,960 Speaker 1: for talking us through at Mike Rohan, Meridian Chief Executive. 99 00:05:10,640 --> 00:05:13,800 Speaker 2: For more from Heather Duplessy Allen Drive, listen live to 100 00:05:13,920 --> 00:05:16,920 Speaker 2: news talks. It'd be from four pm weekdays, or follow 101 00:05:17,000 --> 00:05:18,760 Speaker 2: the podcast on iHeartRadio.