New Zealand utility plans $2 billion
in green projects
Feb 28, 2007 Refocus.net
Contact Energy will invest NZ$2 billion to develop
green power from wind and geothermal facilities over
the next five years.
New generation will be needed by 2012 and new green
power facilities must be developed by that time, says
chief executive David Baldwin. With government support
for the consenting of geothermal and wind development,
the national goal of meeting energy growth from renewables
could be realized.
"Given appropriate policy settings, the company's
investment plans in renewable generation could play
a significant role in helping to advance a more sustainable
and climate-friendly energy generation sector," says
Baldwin. The next stage of Contact's generation growth
would come primarily through investment in 260 MW
of new geothermal generation, with two new power stations
planned for the Taupo region.
"Contact is New Zealand's leading provider of geothermal
electricity, and we have a world-class geothermal
resource in the Taupo region that can provide New
Zealand with much greater amounts of the only form
of baseload, and easily accessible renewable electricity
generation," he says. "Contact will now work to further
quantify the geothermal resource and, upon confirmation
of satisfactory results, enter the site design phase
before moving to resource consenting for a new power
station with a potential capacity of up to 200 MW,
powered by steam from the Tauhara steamfield." The
new plant could be producing energy by 2012.
Contact has also been considering upgrading or replacing
the Wairakei geothermal power station, and it will
develop these plans to have a new facility commissioned
by 2011. Replacing the station with an efficient plant
would add new capacity of 60 MW.
The utility "would need a streamlined consenting
process for its geothermal investment programme if
it were to be implemented within the timeframes anticipated
by Contact to help meet the country's growing demand
for electricity," Baldwin warned. Its 2001 resource
application for Wairakei remains unresolved and, for
new geothermal investment, it is exploring various
options for approval such as recommending that government
direct applications from green power developers to
a board of inquiry or to the Environment Court for
swift consideration.
"We have been encouraged by the draft New Zealand
Energy Strategy and have held positive preliminary
discussions with the energy minister over possible
call-in options," he adds. It will also look to government
to finalize a market-based pricing system for carbon
emissions within the next 18 months.
Contact is developing two sites with significant
wind resources which may generate 400 MW of green
power. It had agreed to purchase two more sites, with
potential capacity of 300 MW, although further feasibility
work is required. Development of any two of these
windfarms would cost up to $1 billion.
"We support the government's commitment to addressing
climate change but feel strongly that, if New Zealand
is serious about taking meaningful steps to reduce
our GHG emissions, then we need price signals across
the entire economy," Baldwin explains. "With the energy
generation sector producing around 10% of the country's
GHG emissions, Contact will support the implementation
of a mechanism to price carbon, but believes it must
be applied across the economy."
Contact Energy is owned 51% by Origin Energy of Australia,
and is New Zealand's largest energy company with $4
billion of assets.
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