Background of geothermal energy in New Zealand

Geothermal energy is extracted from heat deep beneath the earth’s surface.  New Zealand is particularly rich in geothermal energy, especially in the Taupo and Kawerau regions.

Geothermal energy has been used for hundreds of years – first by Māori and then by European settlers and tourists.  Since the 1950s geothermal energy has increasingly been used as direct energy, such as heating homes, and to generate electricity.

On this page:

• What is geothermal energy?
• The history of geothermal energy use in New Zealand
• Geothermal electricity generation in New Zealand
• Direct use of geothermal energy in New Zealand
• Changing geothermal energy technology

What is geothermal energy?

Geothermal energy is extracted from heat contained in the Earth’s core.  Areas of geothermal energy are usually close to the boundaries of tectonic continental plates.  New Zealand has a number of geothermal areas as it sits over two active plates - the Indo-Australian and Pacific Plates.

Geothermal energy has many benefits such as being relatively cost effective, reliable, sustainable, and relatively environmentally friendly.

History of geothermal energy use in New Zealand

Most geothermal use in New Zealand has occurred in the Taupo and Kawerau regions, within the Taupo Volcanic Zone.  Some lower temperature geothermal has a wider geographical spread (see figure below).

The first use of geothermal energy in New Zealand was by central North Island Māori for heating, cooking and therapeutic purposes. European settlers arriving in New Zealand discovered the charm and healing benefits of thermal springs, and a number of spa baths were set up in the Rotorua area from about 1870.

Geothermal waters were used for many years in Rotorua to heat homes, businesses and institutions.  Since 1991, geothermal extraction has been managed to protect surface geothermal activity. Recent trends have been towards communal systems, with 10 or more households typically sharing a well.

In 1958, Wairakei, New Zealand's first geothermal plant, and the world's second, was opened.

Several new plants and efficiency-enhancing second-stage equipment have since been added.  The Ngawha geothermal plant was the first geothermal plant to open via a resource consent applied for and issued under the Resource Management Act 1991.

Geothermal energy for electricity generation

The main use of geothermal energy in New Zealand is for electricity generation.

In 2009, electricity generation from geothermal accounted for over 10 percent of New Zealand's total electricity supply.

Electricity generation from geothermal energy is expected to increase substantially over the next 25 years.  Our Energy Outlook – Reference Scenario states that geothermal is currently the most economic option for new electricity generation.

• Read the Energy Outlook – Reference Scenario

Recent geothermal developments include an upgrade of this plant as well as a number of upcoming geothermal developments.

Most of New Zealand's installed geothermal generation (about 600 MW) is situated in the Taupo Volcanic Zone, with another 25 MW installed at Ngawha in Northland.  The temperature and conditions of particular geothermal reservoirs determine which type of generation technology is used: dry steam, flash steam, binary cycle, or a combination.

There are currently seven fields used for geothermal electricity generation.  The main operators are Contact Energy Ltd (a listed company) and Mighty River Power (a state-owned enterprise).  A significant factor in recent geothermal projects has been the high level of commercial participation by Māori-owned enterprises.

Geothermal energy for direct use

There is a wide range of direct uses of geothermal energy in New Zealand, which involves using geothermal heat directly, without a heat pump or power plant.

The largest geothermal direct user in the world is the Norske Skog Tasman pulp and paper mill at Kawerau.  It uses geothermal fluids to generate clean process steam for paper drying, a source of heat in evaporators, timber drying and electricity generation.

Another example of the direct use of geothermal is the large geothermally-heated greenhouse complex developed next to the Mokai geothermal plant.

Changing geothermal technologies

In recent years an increasing range of geothermal technologies becoming viable for commercial deployment globally.

Australia, for example, has seen a rapid increase in companies developing engineered geothermal systems.  In Germany and Scandinavia, ground source heat pumps are becoming more common.