Transpower Seeks Feedback On Electricity Investment Short-list For Upper South Island

Transpower is inviting feedback on a short-list of possible electricity infrastructure investments for the upper South Island, to ensure a reliable power supply for the future as the region grows and more homes and businesses switch their energy use to electricity.

Communities from Twizel north to Nelson and Tasman rely heavily on electricity generated in the Waitaki Valley, which Transpower’s transmission grid carries northward over long distances.

Nikki Newham, Transpower’s acting Executive General Manager Grid Development, said that without significant new generation or large-scale batteries being built in the upper South Island, upgrades to parts of the transmission grid will be necessary by the early 2030s to supply the additional electricity needed and keep voltage stable.

Transpower’s preferred option is a $77 million investment that includes constructing two new switching stations near Orari and Rangitata north of Timaru by 2028, upgrading two existing transmission lines, and installing equipment to manage voltage.

“These upgrades will interconnect existing electricity circuits, boost the capacity of some existing lines, and help avoid possible surges and outages caused by variations in voltage, ensuring the region’s electricity needs are met into the 2030s,” Ms Newham said.

Transpower has also considered non-transmission solutions, such as incentivising companies to shift power use to off-peak times. While it is too early to contract a provider to help manage electricity use in the late 2020s, Transpower proposes revisiting this possibility closer to the time. A non-transmission solution could reduce the overall costs of supplying power to the region by delaying one or more of the proposed transmission grid upgrades.

Feedback on the short-list of investment options is open until 14 February 2025. After considering the feedback, Transpower will decide whether to submit a proposal for investment to the Commerce Commission in 2025. View the full set of short-list consultation documents and information on how to provide feedback on the Transpower website.

Background

As the sole provider of transmission services in New Zealand, Transpower's spending on transmission assets is regulated by the Commerce Commission.

Projects estimated to cost over $20 million must be approved through a major capex proposal process, for Transpower to be able to recover those costs.

Transpower published a long list of options for investment in the upper South Island in August 2023. That consultation paper and the feedback can be found on the Transpower website.

Transpower’s base modelling for this investment includes the two committed solar farms at Lauriston and Kōwhai Park, and other committed generation that is expected to connect through local distribution networks in the upper South Island. There is no other significant new generation or large-scale battery investment planned for the upper South Island that Transpower is aware of.

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