Hon Simon Watts
Minister for Energy

The Government is leveraging public sector energy demand to drive new energy projects and grow our national supply, Energy Minister Simon Watts says.

“As part of the Government’s Energy Package, we are pursuing possible long-term Power Purchase Agreements (PPAs) across the public service starting with our three largest energy users: Health New Zealand, the New Zealand Defence Force, and the Department of Corrections,” Mr Watts says.

Following the Request for Information issued late last year, the Government is commencing discussions with the energy sector including independent generators and new entrants on opportunities to lock in long-term supply.

“We are focused on one clear outcome – increasing abundant and affordable energy to put downward pressure on power bills for households and businesses,” Mr Watts says.

“There is a strong pipeline of projects ready to go, from large grid-scale generation to site-specific and smaller repeatable projects across the country. We are backing all technologies that can deliver reliable, affordable power at scale, including onshore and offshore wind, solar, geothermal, biogas, woody biomass, hydrogen and battery storage. The priority is simple: get more generation built, faster.”

MBIE is now working with Health New Zealand, the New Zealand Defence Force, and the Department of Corrections on potential long-term PPAs to commence when their existing contracts expire.

“Locking in long-term supply will give developers the certainty they need to invest in new generation, while securing better value and price stability for taxpayers,” Mr Watts says.

“Solar will also play a practical and immediate role. I have directed officials to complete a rapid feasibility study on establishing a streamlined procurement model to accelerate the rollout commercially viable solar across government properties.

“The objective is to support aggregate demand, cut red tape, and bring installations online more quickly increasing supply and reducing peak demand pressures on the grid.”

MBIE will report back by the end of May 2026. If viable, a Request for Proposals will be issued soon after, moving quickly from study to implementation so projects can begin delivering additional generation and cost relief as soon as possible.

Notes:

• For those interested in attending an MBIE-led Power Purchase Agreement (PPA) market information event on 25 March 2026, please email energyprocurement@mbie.govt.nz.
• MBIE ran a Request for Information (RFI) in October 2025, seeking information on how the government’s purchasing power could support new energy investment.
• A PPA is a long-term contract where an agency agrees to purchase electricity from a generator under agreed terms.
• PPAs can reduce financing risk for new generation projects and help enable them to proceed.
• The solar feasibility study will determine if there is sufficient demand, efficiency and cost savings to support establishing a centralised procurement framework for agencies looking to install solar generation on government properties.

© Scoop Media