The national grid operator is warning of possible power cuts this winter if supply and demand cannot be managed to cope with extreme conditions.

Transpower’s Winter Outlook has highlighted the risks to keeping the lights on if winter is severe because of pressures on ensuring sufficient generation, maintaining the lines network, and managing increasing demand.

Chief executive Alison Andrew told RNZ’s Nine to Noon the country was reliant on established resources, but hydro lakes were only at average levels, and two large power generators — a wind farm and a geothermal station — have had commissioning problems.

“There just isn’t enough capacity in the system, and we can also face a dry winter; we don’t have enough water, which [we] rely on very heavily in our system, and if that’s the case, we could get into rolling power cuts.”

The system would need coal and gas-burning thermal stations to provide backup, but they took time to fire up and would result in higher prices, Andrew said.

At the same time, lines companies had to have plans to be able to drop demand, such as turning off water heating at short notice.

However, the country needed more flexible power generation, which could be turned on at short notice to provide greater security.

“If you’ve got flexible resources which can be a gas-fired peaker … they’re faster start-ups, and you can make those decisions in real-time… when the wind drops unexpectedly, or there’s a failure of an electricity transmission line or generator plant, you can respond.”

Andrew said Transpower was also spending on upgrading the national grid to remove blockages in the network to get power to where it was needed, however, it expected to have to spend billions in the years ahead on modernising the network.