Genesis Energy has concluded coal import contract from offshore and also extended its supply agreement with Solid Energy.

The moves are part of the company’s decision to place a second of its older coal/gas generation units at Huntly into storage at the end of 2013.

Genesis Energy chief executive Albert Brantley said the decision to close a second unit as well as to conclude the imported coal contract has been made to meet the changing New Zealand electricity market while ensuring the company is well placed to meet the future.

"We have a clear focus on reducing our costs over the longer term. However, we also want to ensure that the Company can produce enough energy for New Zealand should there be extended dry periods that reduce the ability of hydro stations to operate," Brantley added.

Meanwhile, the company has been negotiating with Solid Energy to extend the supply relationship a further three years to June 2017, subject to Ministerial approval under the Crown Minerals Act, Brantley said.

"We expect to continue to run the two operating coal and gas fuelled units at Huntly," Brantley continued.

"Our reduced reliance on coal is reducing our carbon dioxide emissions, and subsequently reducing our New Zealand Emissions Trading Scheme obligations and that will result in a lower carbon cost to our business."