Vision and strategy
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1Integrated developer, generator and retailer of electricity in New Zealand
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2Innovator in energy products and services
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3Growing value by developing renewables
Our strategy
Meridian has a renewable-led growth strategy that’s built to deliver lasting shareholder value.
We describe our strategy through three areas of focus to create value:
- an integrated developer, generator and retailer of electricity in New Zealand
- a developer of offshore renewable electricity generation
- an innovator in energy products and services.
We manage our strategy through four strategic themes that capture the activities we focus on to deliver lasting shareholder value.
- Improving our commercial performance
- Lifting our customer game
- Growing value by developing renewables
- Innovating to create value
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Improving our commercial performance
by ensuring Meridian is a high performing business -
Lifting our customer game
by delivering a valuable, differentiated offer to customers -
Growing value through the development of renewables
by continuing to develop a portfolio of generation options that enhance value -
Innovating to create value
by expanding into solar generation to keep us on the innovative edge of clean technology
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We focus on
The turbine pit at Benmore hydro station
- ensuring Meridian is an attractive investment that can fund its growth plans
- simplifying and optimising the cost of operations
- improving the productivity and profitability of our assets
- building more stakeholder confidence in our expertise and industry knowledge
- managing our portfolio to optimise wholesale and retail channels
- delivering efficient and effective corporate services
- ensuring our people’s safety, wellbeing and development
- building a high-performing workforce with a commercial, collaborative culture
What we have achieved
- continuing a strong record of shareholder returns – 15.8% average total shareholder return in the past five years
- strong profitability – 18.5% underlying return on equity in 2010/11
- maintaining our credit rating while delivering high dividend yield – $683.6m of dividends paid in 2010/11
- coordinated generation, wholesale and retail operations to optimise our portfolio – 27% improvement in EBITDAF per MWh in the past five years
- industry-leading asset management performance – 0.18% hydro forced outage factor and hydro operating costs that benchmark in the lowest quartile globally.
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We focus on
- increasing our retail segment contribution
- delivering differentiated, valuable offers to our customers through coordinated retail brands
- continually improving our services for customers
- achieving excellence in our processes for customer care and management
- investing in organisational capability to deliver excellent service and support customer-led growth
What we have achieved
- a multi-year programme to deliver service and operational improvements – Velocity billing system upgrade and a roadmap of future initiatives to enable operational excellence
- improving retail contribution – 7% increase in active ICPs during the 2010/11 year and a rebalancing of our customer portfolio from South Island to North Island
- enhancing customer service – 14% increase in average customer satisfaction in 2010/11 and top rankings in Consumer NZ satisfaction survey.
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We focus on
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ensuring generation economics remain competitive with other technologies
Meridian's Te Uku wind farm
- developing commercial strategies that grow our offshore businesses
- underpinning our renewable proposition with sustainable business practices
- promoting the value of renewables to create customer preference
- continually developing our portfolio of valuable generation project options
- enhancing our competitive expertise and leveraging it in New Zealand and overseas
What we have achieved
- a strong pipeline of New Zealand generation options (wind, hydro and irrigation) with a potential generation capacity of more than 1,375MW
- developing offshore markets – 162GWh production from Mt Millar wind farm in 2010/11 and construction commenced on the 420MW Macarthur wind farm
- diversification through new generation technologies – 10GWh production from our USA CalRENEW-1 solar plant in 2010/11.
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We focus on
Expanding into solar generation will keep us on the innovative edge of clean technology
- enhancing value from our existing ventures portfolio
- delivering commercially sound products and technologies that meet our customers’ future needs
- continually assessing new technologies and market opportunities
- increasing the strength of our commercial product and service innovation
What we have achieved
- value realisation and growing shareholder returns from existing ventures portfolio – 74% improvement in other segment EBITDAF in 2010/11
- commercial product and service innovation – 125,000 AMI meters installed by Arc Innovations and 41% of retail customers now receiving bills electronically.