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Defence Force future-proofs electricity costs in new deal

13 July 2010

The New Zealand Defence Force (NZDF) has chosen Contact Energy to be its new electricity supplier in a deal that future proofs it against rising energy prices for the next three years.

In 2009 the Defence Force ran an open competitive tender for electricity supply, as its contractual arrangement with Meridian Energy, which had been supplying the NZDF with electricity since 2001, was about to expire.

The Defence Force recently announced that Contact Energy has been selected as the successful new supplier from four tender proposals. The new contract with Contact Energy is for a term of three-years, with two further rights of renewal for a period of two years each.

Chief of Defence Force Lieutenant General Jerry Mateparae says the Defence Force spends around $8m annually to keep the lights on and computers humming at its Navy, Army and Air Force camps and bases across New Zealand.

“Like any organisation, it’s important that we keep our operating costs as low as possible,” he says. “We are sure this new supply agreement with Contact Energy offers the Defence Force and the taxpayers of New Zealand the best value for money.

“Over the three-year contract period, the proposal from Contract Energy was significantly cheaper than the next best priced proposal from the market.”

Through the new Contact Energy contract, the Defence Force will realise the following benefits:

  • A schedule of fixed prices, meaning the Defence Force is safe-guarded from predicted electricity price increases for the next three years
  • Improvements in invoicing and reporting, which will result in efficiency gains in Accounts Payable and Energy Management; and
  • A proactive energy management approach.

LT GEN Mateparae says with the arrival of the seven new Navy ships that form Project Protector, as well as new infrastructure projects, for example, new hangers at Ohakea Air Force base, in the Manawatu, Defence Force electricity consumption could increase over the next few years.

“The savings we have made through this contract mean we can absorb possible cost increases from greater electricity usage,” says Lt Gen Mateparae.

“Meanwhile, an energy efficiency programme we have been running has already resulted in a reduction in our overall energy consumption.”


For more information please contact Victoria Dew, Senior Communications Advisor on 04 496 0766.

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