12. Question No. 12—Energy and ResourcesJONATHAN YOUNG (National—New Plymouth) to the Minister of Energy and ResourcesQuestion No. 12—Energy and Resources12. JONATHAN YOUNG (National—New Plymouth) to the Minister of Energy and Resources: Why was the average daily wholesale price of electricity across New Zealand on 30 July 2019 67 percent higher than it was a year ago?Hon Dr MEGAN WOODS (Minister of Energy and Resources): It's impossible to pinpoint a specific reason for a daily price. Prices vary from day to day season to season year to year. There is a complex range of factors such as weather lake levels infrastructure outages and demand. There is an inherent volatility in the wholesale prices. While the July 2019 monthly average price at the Ōtāhuhu node has been $113 per megawatt hour in 2018 it was $82 per megawatt hour. I remind that member that in July 2017 when that member's party was in Government the monthly average price was $135 per megawatt hour. That is a percentage increase in monthly average spot prices between July 2016 and 2017 of 98.52 percent and a percentage increase in monthly average spot prices between July 2018 and July 2019 of 37.8 percent.Jonathan Young: What is driving the price up—considering that North Island hydro storage is 107 percent of average South Island hydro storage is 120 percent of average and natural gas and geothermal are flowing normally?Hon Dr MEGAN WOODS: As I told that member in the answer to the primary question given the question he asked me was about a specific day it is impossible to pinpoint a specific reason for a specific day. But I'm sure the member full well understands that what we are seeing at the moment is generators seeing that there's going to be an increase in demand and prices starting to reflect that. We are also seeing on the other side of that balance an increase in investment. We've had over half a billion dollars of investment committed in the last year to renewables projects. This is what that member would describe as the market working well I'm sure.Jonathan Young: Does she agree with Pattrick Smellie who said last week Where $50 to $60 per megawatt hour had often been the norm in recent years wholesale spot prices have risen to sit [comfortably] above $100 per megawatt hour in most parts of the country."?Hon Dr MEGAN WOODS: I just gave the explanation for that in the answer to my last question—that yes we are currently seeing higher wholesale rates. I'd remind that member there is no reason to think that this will necessarily flow through to retail rates as they didn't in 2017 when we saw prices in the $300s per megawatt hour. But what we are seeing is the market reflecting the fact that there is an appetite for investment which we are seeing. We are seeing commitments in investments around renewable energy. But the good news for that member is that what we are seeing is investment in renewable energy which has a far lower levelised cost of electricity than fossil fuel modes and actually what commenters are saying is this will ultimately lead to lower prices for consumers.Jonathan Young: After the Minister has said that prices are higher does she agree that major electricity users like the Glenbrook steel mill fertiliser companies like Ballance and Ravensdown Methanex and the oil refinery—SPEAKER: Order! Order! No lists.Jonathan Young: —thank you sir—are all facing tens of millions of dollars in higher electricity costs?Hon Dr MEGAN WOODS: What I remind that member of is the inherent volatility of this market. If we go back to July 2017—let's go back to a period of time in there where we had 9 July $106 per megawatt hour; 10 July $122; 11 July $144; 12 July $212; 13 July $351—SPEAKER: Order! Order! That concludes oral questions."