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Keeping the lights on

  • Decarbonisation and keeping the lights on will need significant investment
  • Investment needs a stable policy environment
  • Policy risk may have lessened with reviews targeted at better information sharing
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Craig Stent | Posted on Aug 24, 2021
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Back to Core Banking

A virtual tour through Australian banking issues

  • More tailwinds for the banking sector
  • Medium term, the banking sector faces pressure to continue to invest heavily in their digital consumer platforms
  • Differentiated strategies are appearing as banks rebuild their client focus
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Andrew Bascand, Simon Momich | Posted on Jul 1, 2021
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It’s not easy being green

  • The Climate Change Commission’s final advice to the Government is due to be released next Wednesday. This follows a review of interested party submissions and feedback from the initial draft report.  
  • We do not see the key draft recommendations changing, but at the margin we might see some alterations to the Commission’s recommendations.  
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Craig Stent | Posted on Jun 4, 2021
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Are the lights going to go out?

  • Hydro lake storage is at about 60% of normal levels; low lake levels may provide risks to the near-term earnings of the electricity sector.
  • Commercial electricity users on spot power pricing are facing significant cost increases.
  • Dry conditions may mean we burn more coal and gas, which highlights the importance of more investment in geothermal and wind energy projects.
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Craig Stent | Posted on May 6, 2021
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‘Four More Years’

We’re staying

  • Rio Tinto and Meridian have today announced an extension to the Tiwai contract through to December 2024.
  • The government has not as yet needed to provide any support
  • We would expect further announcements on project development with Contact progressing the Tauhara geothermal plant and Meridian developing their Harapaki wind farm.
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Craig Stent | Posted on Jan 14, 2021
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Shadow banks shine light on mortgage deferrals

  • Some of New Zealand’s non-bank mortgage lenders have provided detailed data that illustrates they appear well-positioned to weather an increase in non-performing loans when COVID-related loan deferrals expire
  • Our various probes into the big banks indicate no cause for alarm, albeit we expect loss provisioning needs to rise and small to medium-sized enterprise (SME) lending trends need to be monitored
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Simon Pannett | Posted on Aug 13, 2020
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Are we ‘Thinking Big’ Again?

  • Electrification of industrial and process heat makes sense
  • Pumped storage would be a massive project, but could help achieve the Government’s 100% renewable objective
  • Substantial challenges remain in terms of cost, engineering, and resource consenting
  • Scoping study results unlikely to be published quickly with sector uncertainty to remain in the short term
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Craig Stent | Posted on Jul 27, 2020
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‘Blame it on Rio’

Key Points

  • Rio to leave, another Think Big Project bites the dust
  • Rio Tinto has announced the closure of the New Zealand Aluminium Smelter (NZAS) from August 2021.
  • Short term, the biggest impact on earnings will be felt by Contact Energy and Meridian Energy with stranded generation in the lower half of the South Island.
  • Is it time to move forward and focus on transmission investment and de-carbonisation?
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Craig Stent | Posted on Jul 9, 2020