Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Power link delays carry business risk

Thursday, April 27, 2006

Power link delays carry business risk

Business welcomes the acknowledgement today by both the Electricity Commission and Transpower that a high voltage direct current link to Auckland will be needed by 2017, says Alasdair Thompson, chief executive of the Employers & Manufacturers Association (Northern).

As EMA predicted the Electricity Commission report out today rejected the present Transpower proposal to build the HVDC link in 2010/2011.

"The Commission and Transpower are poles apart over when the new link is needed, but we are pleased they agree it will be needed sooner or later," Mr Thompson said.

"Both parties also agree that substantial investment is required on other areas of the electricity network well before 2017.

"The Electricity Commission says it must put Transpower's HVDC proposal through its investment test and if its not up to scratch, decline it.

"In declining it, the Commission argues that the Transpower proposal is to invest seven years too early giving two main reasons:

* the Net Present Value (NPV) of the capital expenditure required is, in the view of the Commission too high, and

* the value of the capacity benefit delivered by the proposal is just $5 million compared to Transpower's valuation of a benefit of $190 million, both over 20 years.

"Our major concern is the impasse between the Commission and Transpower. Until Transpower presents a case the Commission will approve, business uncertainty over the security of power supply will continue.

"The ongoing delays and uncertainty in making the HVDC decision transfer risk to business, with investment likely to be deferred.

"However we agree with the Commission's recommendation that property rights over land likely to be required for the HVDC link should be pursued well in advance of when it is needed."


© Scoop Media

Business Headlines | Sci-Tech Headlines


Voluntary Administration: Renaissance Brewing Up For Sale

Renaissance Brewing, the first local company to raise capital through equity crowdfunding, is up for sale after cash flow woes and product management issues led to the appointment of voluntary administrators. More>>


Approval: Northern Corridor Decision Released

The approval gives the green light to construction of the last link of Auckland’s Western Ring Route, providing an alternative route from South Auckland to the North Shore. More>>


Media Mega Merger: Full Steam Ahead For Appeal

New Zealand's two largest news publishers have confirmed they are committed to pursuing their appeal against the Commerce Commission's rejection of the proposal to merge their operations. More>>

Crown Accounts: $4.1 Billion Surplus

The New Zealand Government has achieved its third fiscal surplus in a row with the Crown accounts for the year ended 30 June 2017 showing an OBEGAL surplus of $4.1 billion, $2.2 billion stronger than last year, Finance Minister Steven Joyce says. More>>


Mycoplasma Bovis: One New Property Tests Positive

The newly identified property... was already under a Restricted Place notice under the Biosecurity Act. More>>

Accounting Scandal: Suspension Of Fuji Xerox From All-Of-Government Contract

General Manager of New Zealand Government Procurement John Ivil says, “FXNZ has been formally suspended from the Print Technology and Associated Services (PTAS) contract and terminated from the Office Supplies contract.” More>>