Quarterly Operational Update

Quarterly Operational Update for the three months ended 30 June 2024. QUARTERLY HIGHLIGHTS > RESILIENT PORTFOLIO - geothermal and wind generation increase. > ELEVATED PRICES IN FY24 - C&I and mass market yields increase. Gas yield squeezed. > KD2 WIND FARM CONSTRUCTION UNDERWAY - NZAS agreement supports project. COMMENTARY MARKET SUMMARY Low national inflows during the quarter contributed to elevated spot electricity prices averaging $265/MWh in Auckland. Full year national inflows were 23rd percentile with spot prices in Auckland averaging $187/MWh for the financial year. Forward prices remain high averaging $166/MWh in Auckland for financial years 2025 to 2026. Gas supply uncertainty is reflected in elevated near-term forward prices. Normalised national demand during the financial year was 0.9% higher than FY23. RESILIENT PORTFOLIO Despite 30th percentile inflows into the Waikato catchment during the financial year, hydro generation was slightly higher than average at 4,096GWh but 21% lower than last year's record hydro generation. The year end lake level was 103GWh lower than average. Total generation was 8,780GWh (258GWh, 3% lower than PCP). This reflects improved resilience in geothermal generation with 2,622GWh of generation for the financial year (264GWh, 11% higher than PCP) and higher wind generation of 2,062GWh (591GWh, 40% higher than PCP), supported by new wind generation from Turitea South and Kaiwera Downs stage 1 wind farms. ELEVATED PRICES A RECURRING THEMATIC Financial year Commercial & Industrial yields (physical and end-user CfDs) increased by $9/MWh (7%) to $131/MWh versus PCP, reflecting repricing of contract renewals into the high electricity forward curve. Mass Market yields also saw strong growth, up $9/MWh (6%) versus PCP. Gas supply constraints during the quarter contributed to elevated gas purchase costs, increasing to $25/GJ ($13/GJ, 108% higher than PCP). CONSTRUCTION UNDERWAY AT KAIWERA DOWNS WIND FARM STAGE 2 Kaiwera Downs stage 2 construction commenced in June with full generation expected by the end of CY26. This brings Mercury's total FY24 commitment to new renewables to over $700 million with the geothermal expansion at Nga Tamariki announced in Sep 2023. [For Operational Statistics and Charts, please refer to the attached] ENDS Howard Thomas General Counsel and Company Secretary Mercury NZ Limited For investor relations queries, please contact: Paul Ruediger Head of Business Performance & Investor Relations 027 517 3470 investor@mercury.co.nz For media queries, please contact: Shannon Goldstone Reputation & Social Impact Lead 027 210 5337 mercurycommunications@mercury.co.nz End CA:00434596 For:MCY Type:MKTUPDTE Time:2024-07-17 08:30:17