Mighty River Power's generation volumes and sales fell for the three months to September, due to low inflows into the Waikato River and lower customer demand.
Electricity sales fell 5% for the first quarter, compared with the same period last year, partly due to an 8% drop in commercial volumes, largely because of when commercial contracts fall.
However, the average price paid by customers increased more than 3% to $123 megawatts per hour.
Overall generation volumes fell 18%, with hydro generation at its lowest level for a first quarter in Mighty River Power's history.
The company opted to purchase from the wholesale market for additional volumes because it was cheaper than using its gas-fired generation.
Wholesale prices were low during the period because the South Island hydro conditions, which influence national prices, were above average during the period.
Mighty River Power's chief executive, Doug Heffernan, says it was a challenging quarter.
"We had such weak inflows into the Waikato catchment, but importantly we were able to offset that poor inflow through the contribution that came from gas which was over 40% of our total supply.
"And also by using hydro at times when it was most valued in the market typically at peak times so we were able to get very good prices for what were lower hydro volumes."
