PROJECTS
Reviewing the Single Buyer Model for the Electricity Market, New Zealand
The problem
New Zealand’s opposition parties campaigned on a platform of ending New Zealand’s wholesale electricity market and replacing it with a ‘single-buyer’ model. The single-buyer would be a publicly-owned entity that would purchase electricity from private generators and sell power to retailers for on-sale to customers. From a policy perspective this proposal was flawed. From a business perspective, Contact Energy, a leading privately owned electricity generation and retail company, felt that the proposal threatened its business.
How we helped
Castalia identified how the single buyer proposal could be implemented in practice. We analyzed international experience of single buyer models, such as in Ontario (Canada) and Brazil. We modeled the likely financial impact of the proposal on market participants. Our analysis found there was no evidence that a single buyer would achieve better outcomes than a wholesale market. Our report was widely disseminated to decision-makers and stakeholders.
Impact
The opposition parties did not win the election, and the single-buyer model was dropped from policy discourse, as it was generally thought to have been discredited.
The client
Our team
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How can we help you?
How can we help you?
WASHINGTON, DC
+1 (202) 466-6790
1747 Pennsylvania Avenue NW, Suite 1200
United States of America
SYDNEY
+61 (2) 9231 6862
Suite 19.01, Level 19, 227 Elizabeth Street
Australia
AUCKLAND
+64 (4) 913 2800
Sinclair House, 3 Glenside Crescent
New Zealand
WELLINGTON
+64 (4) 913 2800
Level 2, 88 The Terrace
New Zealand
PARIS
+33 (0)1 85 64 10 22
3B Rue Taylor
France
BOGOTÁ
+57 (1) 508 5794
Calle 81 #11-08, Piso 5, Oficina 5-121
Colombia
Thinking for a better world.
WASHINGTON, DC
+1 (202) 466-6790
1747 Pennsylvania Avenue NW, Suite 1200
United States of America
SYDNEY
+61 (2) 9231 6862
Suite 19.01, Level 19, 227 Elizabeth Street
Australia
AUCKLAND
+64 (4) 913 2800
74D France Street, Newton South
New Zealand
WELLINGTON
+64 (4) 913 2800
Level 2, 88 The Terrace
New Zealand
PARIS
+33 (1) 73 44 26 97
6 Rue Duret
France
BOGOTÁ
+57 (1) 508 5794
Calle 81 #11-08, Piso 5, Oficina 5-127
Colombia
Thinking for a better world.