Where does your power come from?

Posted on Feb. 10, 2021, noon

Where does your power come from?

Power is one of those things that we take for granted in life.

We're so dependent on it for so much of what we do, yet for most of us, we hardly think about how it actually works. We simply expect a light bulb to turn on at the flick of a switch.

To give a bit of brain dump on how power gets to your door, we need first start at the beginning of market reform.

For those that remember (way, way back in the 80's), power was provided by the New Zealand Electricity Department (NZED). The NZED was set up as a Government Department, responsible for managing all facets of the power supply chain. This included generation, transmission, distribution and retailing electricity to end customers. It had full control of, and was responsible for, supplying and ensuring supply of power for all NZer's across the many regions.

Then, along came the 90's, and some guy had a brilliant idea to de-regulate the power sector, and effectively open it up to greater competition.

These days, there are a number of large and small generators, of all shapes and sizes, who create power from renewable sources (e.g., water, sun, wind), as well as from gas, coal and oil. Retailers buy power from these generators through a common market pool called the "wholesale spot market". And there's also a whole lot of poles and wires in between to help transport power to your front door.

It's easy to take all of this for granted, given power is so integrated into our every day lives. But, as we begin to learn more about how it all works, you really can't help but appreciate the amount of work involved in getting that power to your front door.