The decline in gas supply has led to production cuts and a 99-percent increase in coal-generated electricity - according to MBIE

Methanex, New Zealand's biggest energy consumer, has cut back on its methanol production as a result.

Director of energy sector researcher, Enerlytica, John Kidd says the system will adjust - but unfortunately this is not a costless exercise.

Kidd says New Zealand is structurally short on energy, 'full-stop' - so there's not enough energy in the country to support demand.