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Speaker 1: So the government of putting two hundred million into Genesis

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Speaker 1: as part of the capital Rays. Of course, they currently

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Speaker 1: owned fifty one percent. The two hundred allows them to

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Speaker 1: keep that steak. The money is for the stampede towards renewables.

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Speaker 1: Nikola Willis is the Finance Minister and is back with us.

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Speaker 1: Good morning, Good morning mate. You're doing this willingly.

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Speaker 2: Yes, we are, as we said last year. We are

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Speaker 2: on the side of making sure that New Zealand has

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Speaker 2: both enough electricity generation for our growing needs, but also

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Speaker 2: enough firming capacity so that when the hydro lakes aren't

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Speaker 2: full and the wind isn't blowing and the sun isn't shining,

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Speaker 2: we have enough firming capacity that is back up generation.

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Speaker 2: And the Genesis proposal ticks those boxes.

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Speaker 1: Why don't you let the market do them?

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Speaker 2: Well, the market is doing it in the sense that

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Speaker 2: Genesis have gone to market with this capital raise, and

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Speaker 2: it's dependent on market participation. If we don't take part

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Speaker 2: in this equity Rays, our New Zealand government share would

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Speaker 2: reduce below fifty one percent, which would be in breach

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Speaker 2: the current law which requires us to maintain majority ownership.

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Speaker 1: That's why I asked that question because in watching you

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Speaker 1: yesterday on the tiles, you said, the law means we

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Speaker 1: have to You are in charge of the law, and

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Speaker 1: you can change the law if you want to. Hence

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Speaker 1: my question about how willing you are to do this.

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Speaker 1: So you booked in by the law or it's just

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Speaker 1: we don't have two hundred million bucks.

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Speaker 2: Yeah, Look, it's a fair enough question. The coalition government

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Speaker 2: is committed to that majority ownership, so there isn't any

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Speaker 2: mandate around the three governing parties now to change that law,

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Speaker 2: and so we're sticking to that, and we don't want

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Speaker 2: that to be a barrier to actually these energy companies

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Speaker 2: growing in the way that New Zealand is need for

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Speaker 2: us to have secure electricity supply. So it's one of

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Speaker 2: those situations we were doing the right thing. We think

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Speaker 2: it does stack up for taxpayers. One of our criteria

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Speaker 2: going in. Yes, we were very clear going in that

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Speaker 2: we needed to participate on the basis that it would

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Speaker 2: support new generation and firm and capacity, that it commercially

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Speaker 2: staff up, and that there are other investors coming to

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Speaker 2: the table. So all of those things are present in

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Speaker 2: this opportunity.

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Speaker 1: Let me come back to that in just a couple

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Speaker 1: of moments though, because there's no question, I mean, we

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Speaker 1: all agree that we need more capacity. I think we

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Speaker 1: all get that, and I think I would argue, there's

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Speaker 1: no question they could go to the market and get

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Speaker 1: every cent they want and then some they don't need you.

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Speaker 2: Well, in this case, if we didn't take part, we

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Speaker 2: would be diluted down below fifty one. I get that.

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Speaker 1: Who cares so well?

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Speaker 2: Well, I think you'd find that my one of my

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Speaker 2: coalition partners would care very much, and that would be

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Speaker 2: a block to participation, and then we'd be in this

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Speaker 2: situation where the government was actively holding back much needed

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Speaker 2: investment and affordable energy supply. So look, MMP means that

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Speaker 2: there are three parties at the table, we've all reached

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Speaker 2: agreement on this, and frankly, the National Party also doesn't

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Speaker 2: have a mandate from New Zealanders right now to reduce

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Speaker 2: our share of the energy companies below fifty percent.

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Speaker 1: So that's the sort of thing your campaign on, I'm assuming.

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Speaker 2: Well, we will campaign clearly on our view of the

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Speaker 2: future of the energy companies. Genuinely, it's not something our

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Speaker 2: Caucus of determined position on yet. Obviously, the state owns

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Speaker 2: a number of assets that deliver public goods and deliver

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Speaker 2: things that New Zealanders want, and how we manage them

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Speaker 2: well and run them well into the future will be

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Speaker 2: an active discussion for our national cutting team.

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Speaker 1: And just quickly back to the equation. Does the interest

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Speaker 1: on the borrowing get off set by the return on

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Speaker 1: the shares or you can't say that with any certain.

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Speaker 2: Well, I'm very limited in what I'm allowed to say

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Speaker 2: while the rays is in market. So there is significant

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Speaker 2: information that has been provided to the market by Genesis,

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Speaker 2: and I've been advised to be very careful not to

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Speaker 2: go any further than that which is in the market

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Speaker 2: because then I get into the position of the government

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Speaker 2: trying to screw the scrum on the capital race. So

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Speaker 2: I'm going to be careful about that. But what they've

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Speaker 2: done is they've consistently said, look, we want to stick

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Speaker 2: to our current debt rating for a week, lass we

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Speaker 2: want to stay to our current dividend policy. But this

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Speaker 2: plan means they can accelerate their investment pipeline. Rather than

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Speaker 2: at taking ten to fifteen years, it'll take five to

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Speaker 2: six to create that extra generation capacity.

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Speaker 1: Appreciate your time as always, Nichola Willis, who is the

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Speaker 1: Finance Ministry.

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Speaker 2: For more from the mic Asking Breakfast, listen live to

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