By Robert McLachlan 20/12/2019

A short update on wind power in New Zealand, where there has been a string of positive announcements since I discussed the Turitea wind farm in May:

  • On 22 May, Genesis committed to buy all the electricity from Tilt Renewables proposed 133 MW Waipipi wind farm at Waverley, south Taranaki, which allowed the project to go ahead. Construction is to start shortly.
  • On 12 November, Mercury Energy decided to build the whole Turitea wind farm, expanding it from 113 MW to its full 222 MW. They own enough hydro generation to cover the variability of wind. Construction has started.
  • On 22 November, the Government approved funding for two wind turbines in Stewart Island. This is small, but locally significant, as the island currently burns through 360,000 litres of subsidised diesel each year, and, until now, dozens of studies have come to nothing.
  • On 16 December, North Canterbury lines company Mainpower decided to build the Mt Cass wind farm. (It’s either 93 MW, as reported by Stuff, or 78 MW as specified in the resource consent.) Apart from a 1 MW mini hydro system at Little River, Mainpower has not been a power generator until now.

All up that’s another 433 MW, compared to our existing 690 MW of wind, which generates 5% of our electricity. In addition, Mercury is quite likely to eventually add the (up to 318 MW) Puketoi wind farm further east, since they’re putting in the lines infrastructure for it now. This all adds up to a significant boost to renewable energy, which should keep a lid on wholesale electricity prices, which have been rising sharply, and cut emissions. Predictions are that as renewables are added, baseload gas will close, potentially cutting emissions by 800,000 tonnes of CO2 a year.

2016 5.8c
2017 8.1c
2018 11.3c
2019 13.4c
Average wholesale electricity prices

These announcements are also consistent with how things looked to me in May, namely that there is insufficient incentive for existing operators to build large new renewables. These farms are either from new operators (Mt Cass), subsidised (Stewart Island), or will not sell their electricity into the spot market (Waipipi and Turitea).

A number of consents are due to expire in the next few years, notably Genesis Energy’s massive 860 MW Castle Hill wind farm in the Wairarapa. Genesis Energy emits 2.5 million tonnes of CO2 a year from their coal and gas-fired generation, and a lot more from their half-ownership of New Zealand Oil and Gas. If Castle Hill goes ahead, we will really be able to say that the tide has turned.

0 Responses to “Blow, wind of fruitfulness”

  • Hi Robert, Mainpowers Mt Cass wind farm is 93mw as consent was granted for less turbines and higher output earlier in 2019. Also they have small generation at Cleardale under Mt Hutt not Little River. Thanks

  • The windfarms will increase the price of power because more generation needs to be on standby because wind is so unreliable. That is all the overseas experience.
    It is likely that the extra windfarms will be dispatched off at the times of low NI generation and the units at Huntly kept running. They need the thermal units for both inertia and voltage control, neither of which asynchronous generation can offer.

    • Thanks Chris. I am not aware that there has been any curtailment so far at 5% wind generation. Eventually a point will come at which extra stabilisation and storage is required, although the studies I have read suggest that we are still quite far from that point. Price setting is quite complex and hard to forecast, the cost of new supply is only one factor. There is a national interest in restraining power prices, in fact I’m surprised at the limited complaints with the increases that we have seen; it’s not impossible that there could be further government intervention to lower prices.

  • There has been voluntary curtailment by some of the wind generators. They said it was uneconomic for them to generate at the low market prices.
    If you want to know what high renewables penetration does, look at Australia now, where prices just about dusk skyrocket to near cap levels. If the government intervenes in the market here, they will stuff it up like they usually do.

  • The current generation graphs show that Westwind has limited their output to 95MW since 10:40 on the 15th. This is at the same time as Whirinaki has been fired up on diesel to make up the generation shortfall.

  • It is good to see some Wind slowly being constructed in New Zealand, well done to Mercury on that.. However, this is a snails pace… it needs to happen a lot faster. New Zealand needs to install about 3,200 MW of Renewables (or 11,200 GWh) in order to successfully displace Baseload Gas from the system and move us away from dependency on Fossil Fuels.

    Unfortunately, the current electricity “Market” System will not allow for this transition, as the one and only job of the Energy Traders that work for Mercury and Meridian is to make sure they do not bid in too much Cheap Hydro and accidentally displace gas from the wholesale dispatch stack.. Thus, these Traders do not want an excess of stored Hydro Water on their hands which is what more renewables will create.

    The market system is set up to protect the extraordinary profits of the Gentailers, not to promote cheap renewable electricity for New Zealanders.