Genesis Energy to use Kupe profits for $1b renewables project

The news: New Zealand energy retailer Genesis Energy has said it will use profits from the Kupe gas field to support a NZD1.1 billion ($1 billion) renewable generation and grid-scale battery storage program between now and 2030.

The numbers: Genesis announced that as part of a strategy reset, investment will be made into solar, grid scale battery storage and wind, helping to grow the company's renewable output by 160% to around 8,300 gigawatt hours (GWh). The energy retailer's proportion of renewable generation is targeted to rise to 95% by 2035, in line with New Zealand's total generation.

The context: The ASX- and NZX-listed company, which is 51% government owned, has a 46% interest in the Kupe gas field, which supplies gas to Huntly Power Station, the largest thermal power station in New Zealand. Genesis said that it forecasts its strategy reset, which will see profits from Kupe flow to renewables development, will drive growth in earnings with EBITDAF of around NZD500 million in FY25 and mid-high NZD500 millions between FY26 and FY28.

What they said: Genesis CEO Malcolm Johns said: "Electrifying the economy is the pathway to achieving net-zero 2050. New Zealand needs to move from 40% energy drawn from electricity today to more than 70% by 2050. That means electrifying our homes and businesses much fast than we are currently."