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Wairakei Ring economic investment

Background

Transpower has commenced analysis of the scope for economic investment in the lower South Island (enabling renewable generation for the lower South Island) and the central North Island (enabling renewable generation in the Wairakei Ring) also known as the Transmission to Enable Renewable investments (TER).

The Commission and Transpower met to discuss how to approach the grid investment test for these projects. Following the meeting, the Commission’s Board was presented with a paper seeking the Board’s guidance as to how generation scenarios could be developed and the economic analysis undertaken. An interested party has asked for this paper to be provided.

Following the January 2008 Board meeting, the Commission wrote to Transpower to provide high-level guidance on these projects.

A timeline for development and consideration of these two projects has been proposed by Transpower and agreed by the Commission in February 2008

In April 2008, Transpower wrote to the Commission, providing an updated process and timeframe for consideration and approval of the TER proposals.

The Commission agreed to this revised timetable (“the May 2008 timetable”) which anticipates Transpower submitting the TER proposals on 28 October 2008 and the Commission releasing a notice of intention in December 2008.

In August 2008, Transpower wrote to the Commission advising that it was intending to proceed with the Wairakei Ring project, but wished to defer the Lower South Island project for further investigation. Transpower advised that it now expects to submit the Lower South Island project to the Commission in mid 2009.

Transpower further advised that it now intended to submit the Wairakei Ring project on 17 December 2008. Accordingly, a further revised timetable (“the September 2008 timetable”) was agreed to.

The September 2008 timetable lapsed as the Commission’s review of the investment required more work than was originally anticipated. Accordingly, on 28 January 2009, the Commission and Transpower agreed to an amended timetable (“January 2009 timetable”).

Transpower's application (17 December 2008)

On 17 December 2008, Transpower submitted to the Commission a new Grid Upgrade Plan (2008 GUP), under rule 12 of section III of part F of the Electricity Governance Rules 2003.

The 2008 GUP includes Transpower’s Wairakei Ring Investment Proposal to facilitate connection of renewable generation in the central North Island. Transpower’s proposal is to build a new double circuit 220kV line connecting directly from Wairakei to Whakamaru. This new line would approximately parallel the existing Wairakei-Whakamaru “B” line, which would be decommissioned and removed.

Transpower has submitted the Wairakei Ring proposal as an economic investment and seeks approval of up to $141 million for the proposal. As an economic investment, Transpower has already consulted with the public on the proposal.

Notice of Intention (20 February 2009)

On 20 February 2009, the Commission published a notice of intention to approve the Wairakei Ring Investment Proposal.

Reasons for decision (20 February 2009)

The document below presents the Commission’s analysis of the Wairakei Ring Investment Proposal and explains the reasons supporting the Commissions intention to approve the proposal.

The Commission was assisted in its decision making by further analysis undertaken by Transpower, its staff and external advisers.

Opportunity for comment

Under rule 15.2 of section III of part F of the Electricity Governance Rules 2003, a designated transmission customer, an authorised representative of parties substantially affected by the Grid Upgrade Plan, or Transpower, may, within 10 working days of the date of publication of the notice of intention (that is, by 5pm on 6 March 2009), request that the Commission hold a public conference if they consider that:

  • The interests of end use customers are materially adversely affected by the cost or the service outcome of the reliability investment to which the notice relates; or 
  • The Grid Investment Test has not been applied properly to the Grid Upgrade Plan

The purpose of a public conference is to provide a final opportunity for comment on the reliability investment to which the notice relates.

If no request to hold a public conference is received, or if the Electricity Commission determines not to hold a public conference, the Electricity Commission’s decision, as set out in this notice of intention, is final.

No request for a public conference was received on the Wairakei Ring Investment Proposal; therefore the Commission’s decision to approve the Wairakei Ring Investment Proposal is final.

 

Last update on 26 March 2009 03:01 PM