National grid operator Transpower says it may have to issue a warning to the electricity industry if significant rain does not fall in the next few days, because South Island hydro lake levels are low.
The "watch" alert does not indicate that there will be power shortages, only that generators and consumers need to be aware hydro-generation in the South Island could be reduced further.
Southern lake levels are below average, at about 65% of maximum capacity. More electricity is being sent from the North Island, where lake levels are above average, as southern generators reduce their output.
Transpower general manager of operations Kieran Devine says rainfall is expected this weekend but if it doesn't happen an alert would most likely be issued to the industry early next week.
He says while lake levels are low, they are still well above levels that triggered the last serious power shortages in 1992.
It's the first time the national alert system has been used since new rules were introduced 18 months ago.