PROJECTS

Analysis of Disruptive Technologies in Energy Distribution, New Zealand

The problem

Vector, New Zealand’s largest energy distributor, planned a major reinvestment program. It worried that disruptive technologies—including battery-storage, smart-grid and distributed generation—could destroy value in traditional electricity distribution infrastructure. Vector was not sure how to future-proof its investment plan against technological disruptions.

How we helped

Castalia analyzed disruptive technologies most likely to affect Vector between 2014 and 2030. We developed strategic framework that gave indicators that would predict which disruptive technologies would succeed, and to respond accordingly. We showed how policy and commercial factors might accelerate or delay uptake of the technologies compared to what would be expected on a purely techno-economically optimized basis. We estimated likely impacts on Vector from adoption of disruptive technologies, along with likely timing, and options for Vector to capture value and avoid stranding of assets.

Impact

Vector’s strategic decisions on asset management, investment and business planning were shaped by our advice, enabling Vector to position to capture value from battery-storage and other new technologies, and reduce the risk of stranded-assets.