I just saw a talk by Carl Hansen, the Chief Executive for the NZ Electricity Authority. He made a comment which is retrospectively obvious.
Electricity is a natural resource, and follows natural resource economics. So investors in electrical generation will build the the lowest price solutions first, and as time goes on the cost of delivering a power plant in c/unit terms will increase. So sadly, baring another gas discovery, we will rising real costs of electricity supply in the future. He estimated the marginal cost will be $90/MWh (9 cents per unit) by 2020, based on the prices to build and fuel the next up stream of power generation projects.
The Electricity Authority has 3 mandates – to increase competition (and thus reduce the chance of excessive margins), to promote reliability of supply (no blackouts) and to push for lower transaction and regulatory costs and thus increase efficiency. I asked Carl about feed in tariffs after he spoke – for now they are off the agenda, but it seems that making it easy for small businesses to get a fair price for their generated power is part of their mandate.