What difference will West Wind Power Project make
What difference will the West Wind Power Project make
NZ Council for Infrastructure Development
What difference will the West Wind Power Project make to NZ's energy needs?
"From a national perspective, the decision by Wellington City Council on the eve of Christmas to approve Meridian Energy's $380 million wind power station near Makara is excellent news.
The West Wind power project is impressive. It adds to an extensive number of proposals announced by generators this year that are now either under development or tip-toeing their way through the consenting process.
But, in an environment of daily uncertainty about next years energy supply, and with electricity spot prices dependent on whether or not it might rain tomorrow, will this be enough?
At current rates of demand growth, New Zealand needs at least 150 megawatts of additional power every year to meet expected electricity demand.
That means, the 210 megawatts added by West Wind is a little more than one years annual growth in demand across the country.
If the project takes x years to go through an RMA appeal process and build, will the energy come on stream in time to meet future needs?
If it does, will the transmission grid then have sufficient capacity to cope?
What will we do if there's no wind?
Or, even worse, what if there's no wind and no water?
Will there be enough fuel to keep the thermal power stations running?
In short, will the collective investment in New Zealand's generation capacity and transmission infrastructure be sufficient to meet future energy needs?
These are the questions New Zealanders, and domestic and international firms looking to invest in New Zealand's economy need the answers to.
Its clear that both Transpower and the generators are committed to responding to the supply side of the equation.
But what's required is for the industry, the Electricity Commission, The Ministry for Economic Development, the Energy Efficiency Conservation Authority, or through their collective actions, the Government itself to provide assurance that planned supply will be on stream in line with expected demand.
A regularly updated national plot of generation proposals compared against the future demand trend would go a long way to put in context the relative progress we are making, and help rebuild confidence that both Government and the energy industry do have things in hand (see chart below).
This is the kind of leadership that both the public, investors and the business community are looking for.
As it stood in August, the supply and demand balance runs very close to the line in a dry year, but future margins look more encouraging, provided the plant come on line as planned and we can fuel the large thermal plants.