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Greens supply answers to the power plant puzzle

Greens supply the answers to the power plant puzzle

Green Co-leader and Energy spokesperson Jeanette Fitzsimons has noted some gaping holes in the Government's explanation today for building a new oil-fired power plant at Whirinaki. In the interests of furthering understanding of just how we found ourselves in an energy crisis this winter, she provides the answers the Minister didn't give.

Q Why is this site in Hawkes Bay being used for a new power plant?

A: Because Contact Energy used to operate one there, and there are resource consents already for the site.

Q: What happened to the plant that used to be there?

A: It was a "stand-by" plant designed to supplement supply in a dry year. When Contact Energy was split off from ECNZ and then later privatised the new owners decided it was "uneconomic" to own a plant that ran only rarely so they dismantled it and sold it to Australia

Q: What was the difference between that plant and the one that will be built?

A: Not much, it appears.

Q: How did Contact benefit from selling the previous Whirinaki plant?

A: Both by ridding itself of a plant it could only earn revenue for in very dry years; and by forcing the spot price to extraordinary heights in recent dry years. Contact has more thermal generation than other generators so could sell this at a very high price.

Q: Why will the plant be owned by the Ministry of Economic Development?

A: Good question. They advised the previous government who sold Contact Energy, caused the present chaos in the industry and thereby deprived us of a stand-by plant at Whirinaki

Q: Would the taxpayer and the electricity consumer have been better off if Contact had never been privatised and Whirinaki had never been sold?

A: Undoubtedly, but as the Ministry of Economic Development will tell you, the present system "all works in theory."

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