Lacking spark: Declining wholesale electricity prices have constrained industry revenue

Operators in the Electricity Retailing industry have faced mixed conditions over the past five years. A decline in wholesale electricity prices has limited industry revenue growth, but supported increased profitability over the period. Meanwhile, greater awareness of electricity consumption by consumers and businesses, and the increased uptake of home insulation and household solar panels have weakened per capita demand for centrally-generated electricity. Overall, industry revenue is expected to increase at an annualised 2.4% over the five years through 2017-18, to reach $6.5 billion. This includes expected growth of 1.6% in the current year, due to weak growth in electricity more.

Industry Statistics & Market Size
Annual Growth 13-18
Forecast Growth 18-23

Industry Report - Industry Analysis Chapter

The Electricity Retailing industry has been affected by a series of regulatory and structural changes over the past five years. Changes to oversight and partial privatisation have increased industry competition and participation over the period. A decline in wholesale electricity costs and weak growth in distribution costs have supported improved profit margins but have constrained growth in revenue, as retailers have passed some of the savings on to consumers. Industry revenue is expected to grow at an annualised 2.4% over the five years through 2017-18. Limited wholesale prices are expected to lead to slow revenue growth of 1.6% in 2017-18, to reach $6.5 billion...purchase to read more.

Additional Insights for the Electricity Retailing Industry

IBISWorld identifies 250 Key Success Factors for a business.The most important for the Electricity Retailing Industry are

  • Ability to effectively manage risk
  • Ability to alter goods and services produced in favour of market conditions
  • Ability to allocate product/service to area of greatest need
  • IBISWorld analysts also discuss how external factors such as Electricity service price and Net energy consumption in the Electricity Retailing industry impact industry performance..

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    What's in this report

    What is the Electricity Retailing in New Zealand Industry?

    Industry operators purchase electricity on the wholesale electricity spot market and onsell it to consumers and businesses.

    Industry Products
  • Hydro electricity
  • Thermal electricity
  • Geothermal electricity
  • All other electricity
  • Industry Activities
  • Electricity retailing
  • Electricity market operation
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Electricity service price
  • Net energy consumption
  • Public concerns over environmental issues

  • Current Performance
  • Regulatory changes
  • Industry structure
  • Profit margins
  • Chart: Revenue Growth

  • Industry Outlook
  • Industry participation
  • Electricity consumption
  • Tiwai Point Aluminium Smelter
  • Table: Electricity Retailing Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Electricity Retailing Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Consumers in New Zealand

  • Key Selling Industries
  • Electricity Transmission and Distribution in New Zealand
  • Fossil Fuel Electricity Generation in New Zealand
  • Geothermal, Wind and Other Electricity Generation in New Zealand
  • Hydro-Electricity Generation in New Zealand

  • Products & Services
  • Hydro electricity
  • Geothermal electricity
  • Thermal electricity
  • All other electricity
  • Chart: Electricity Retailing Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Industrial users
  • Households
  • Commercial users
  • Agricultural/Forestry/Fishing users
  • Chart: Major Market Segmentation for the Electricity Retailing Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Chart: Cost Structure Benchmarking – Sector vs Electricity Retailing

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Electricity Retailing Industry

  • Industry Globalization
    Contact Energy Limited, Genesis Energy Limited, Meridian Energy Limited, Mercury NZ Limited, TrustPower Limited,
  • Table: Contact Energy Limited - financial performance
  • Table: Genesis Energy Limited - financial performance
  • Table: Meridian Energy Limited - financial performance
  • Table: Mercury NZ Limited - financial performance
  • Table: TrustPower Limited - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Electricity Retailing Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Electricity Retailing Industry
    Includes: Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
  • Stands for earnings before interest, tax, depreciation and amortisation, and fair value adjustments, and is commonly used in the electricity industry as a measure of profit.
  • Gentailer
  • The term refers to generator-retailers, vertically integrated energy companies involved in electricity generation and retailing.
  • Installation Control Points (Icps)
  • ICPs refer to the installation control points managed by an electricity retailer and can be used as a measure of market share.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Electricity Retailing in New Zealand market research report is a comprehensive guide to market size and growth prospects. Our industry reports offer strategic industry analysis of the factors influencing companies, including new product developments, economic, lifestyle and demographic influences, distribution and supply chain factors and pricing issues. Full analysis accompanies our data forecasts to illustrate how the market responds to emerging industry trends.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
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    This report on Electricity Retailing in New Zealand:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Electricity Retailing in New Zealand market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Electricity Retailing in New Zealand, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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