Overpowered: The shift towards renewable energy has continued to erode industry revenue

Difficult trading conditions and a structural shift in New Zealand towards renewable energy sources have negatively affected the Fossil Fuel Electricity Generation industry over the past five years. The industry is expected to decline by an annualised 13.1% over the five years through 2017-18, to $334.3 million. Wholesale electricity spot market prices are expected to decline significantly over the five years through 2017-18, reducing industry profitability significantly over the period. However, the industry is expected to increase revenue by 0.9% in 2017-18 as low water levels reduce the capacity of the Hydro-Electricity Generation industry, increasing reliance on fossil fuels in the short term...read more.

Industry Statistics & Market Size
Revenue
$334m
Annual Growth 13-18
-13.1%
Forecast Growth 18-23
Profit
Employment
339
Businesses
8

Industry Threats & Opportunities

  • The shift towards renewable energy generation has decreased demand for fossil fuel electricity generation
  • Government energy efficiency initiatives have reduced the energy consumption of consumers
  • Industry revenue is forecast to decline by 2.8% over the next five years
  • Industry Report - Industry Locations Chapter

    The industry's business locations are located in five of New Zealand's regions. All of New Zealand's natural gas resources are located on the North Island, with no proven or viable resources on the South Island. Although coal resources exist on the South Island, none are used to service coal-fired power stations. Consequently, all industry activity takes place on the North Island.Taranaki and Waikato contribute to the majority of industry activity. Taranaki is host to Contact Energy's Stratford Power Station, while Genesis Energy's Huntly Power Station is located in the Waikato region. Contact Energy's Whirinaki Power Station is located in Hawke's Bay. Alinta Energy's Glenbrook Power Station is located in Auckland...purchase to read more.

    Additional Insights for the Fossil Fuel Electricity Generation Industry

    IBISWorld has determined the most important Key Success Factors for the Fossil Fuel Electricity Generation are:

  • Ability to expand and curtail operations rapidly in line with market demand
  • Upstream vertical integration (ownership links)
  • Ability to accommodate environmental requirements
  • IBISWorld analysts also discuss how external factors such as Electricity wholesale price and Demand from geothermal, wind and other electricity generation in the Fossil Fuel Electricity Generation industry impact industry performance..

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    What's in this report

    What is the Fossil Fuel Electricity Generation in New Zealand Industry?

    Industry operators use raw material inputs such as coal, gas or oil to generate electricity.

    Industry Products
  • Gas-fired electricity generation
  • Coal-fired electricity generation
  • Oil-fired electricity generation
  • Industry Activities
  • Coal-fired electricity generation
  • Gas-fired electricity generation
  • Electricity generation using oil
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Electricity wholesale price
  • Demand from geothermal, wind and other electricity generation
  • Net energy consumption
  • Demand from hydro-electricity generation

  • Current Performance
  • Renewable energy
  • Profit
  • Demand growth
  • Chart: Revenue Growth

  • Industry Outlook
  • Renewable energy
  • Profit
  • Tiwai Point
  • Gas-fired power generation
  • Table: Fossil Fuel Electricity Generation Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Fossil Fuel Electricity Generation Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Electricity Retailing in New Zealand
  • Consumers in New Zealand

  • Key Selling Industries
  • Coal Mining in New Zealand
  • Heavy Machinery Repair and Maintenance in New Zealand
  • Oil and Gas Extraction in New Zealand

  • Products & Services
  • Gas-fired electricity generation
  • Coal-fired electricity generation
  • Oil-fired electricity generation
  • Chart: Fossil Fuel Electricity Generation Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Industrial firms
  • Households
  • Businesses
  • Agriculture, forestry and fishing firms
  • Chart: Major Market Segmentation for the Fossil Fuel Electricity Generation Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Purchases
  • Depreciation
  • Wages
  • Other
  • Chart: Cost Structure Benchmarking – Sector vs Fossil Fuel Electricity Generation

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Fossil Fuel Electricity Generation Industry

  • Industry Globalization
    Genesis Energy Limited, Contact Energy Limited,
  • Table: Genesis Energy Limited - financial performance
  • Table: Contact Energy Limited - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Fossil Fuel Electricity Generation 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 Fossil Fuel Electricity Generation Industry
    Includes:
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Wages (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Baseload Power
  • Electricity generators that runs continuously to satisfy minimum demand from the wholesale market.
  • Centrally Generated Electricity
  • Large-scale electricity facilities that sell to the grid.
  • Peaking Power
  • Electricity generators that can be switched on during periods of peak demand.
  • What Our Customers Say

    Why buy this report?

    The Fossil Fuel Electricity Generation in New Zealand market research report provides key industry analysis and industry statistics, measures market size, analyzes current and future industry trends and shows market share for the industry’s largest companies. IBISWorld publishes the largest collection of industry reports so you can see an industry’s supply chain, economic drivers and key buyers and markets.

    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
    • Quickly build competitive intelligence
    This report on Fossil Fuel Electricity Generation 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 Fossil Fuel Electricity Generation 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 Fossil Fuel Electricity Generation 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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