3. Details of Opportunities for 2004 and Beyond
3.1 Introduction
This section outlines opportunities for new or increased power generation capacity in New Zealand for 2004 and the subsequent years. The opportunities are largely reviewed in a geographical sequence from the North to South of New Zealand. Gas turbine options have been discussed substantially in Section 2 of this report because of the potential for some of these options to be commissioned within a very short time frame. Clearly, the same options could be scheduled for commissioning in a longer time frame and should be considered in context with the options listed in this section.
Opportunities for increasing geothermal power generation in New Zealand can assist in the short-term situation and also contribute significantly to long term generation growth in New Zealand. Geothermal has an advantage of being able to achieve a high load factor giving it a GWh advantage over other sources. However, operating as base load generation is not the only way a geothermal station can be operated. In other parts of the world, they are run in a load-following mode, as in effect the Poihipi station is being operated at present.
The capacities suggested in this report are fairly conservative in that they are based on continuous operation at full output over a 30-year project life. It is quite possible to install more capacity and run the field to depletion over the same 30 years, but with the station varying its output to meet the needs of the system. If geothermal stations were run in a load following mode, they could help meet peak demands, run continuously at maximum output for hydro firming (reducing the output of the hydro stations to refill the storage lakes) and during shortages. Studies are needed to show whether or not this is preferable to building coal-fired stations for the same purpose. Coal fired stations for hydro firming are likely to have a lower capital cost than the incremental cost of increasing the output of a geothermal station but the standby and fuel costs will be higher. Apart from the higher capital cost, the major reason this is not being done at present is because the consent authorities frame resource consents for geothermal projects in terms of tonnes per day, based on, for instance, a 50% depletion over the lifetime of the projects (usually 30-50 years). The important factor is the long-term depletion rate, so allowing day to day changes in demand needs to be considered.
We believe that the concept of using geothermal stations in a load following mode to provide hydro firming has environmental benefits over coal fired plants and may also be more economic. Further study into this concept would be well worthwhile.
The same opportunity does not exist for hydro or wind.
The progress of many proposed geothermal development projects is constrained by the consent process. In many cases, the assessed environmental impact of these projects is low.
3.2 Ngawha Geothermal
There is 10MW of geothermal power generation capacity installed at Ngawha, operated by Top Energy, using binary plant. The plant could produce a further 0.3MW subject to an additional resource consent.
There are additional existing production and re-injection wells available which were drilled by the Crown. Some of these were purchased by Top Energy but others are still in Crown ownership and are expected to be transferred to Mighty River Power. These wells could yield 20MW. There are also two wells that have been partially completed and so available at less time and cost than a new well.
Expansion at Ngawha using existing wells is a rapid and low risk opportunity. However, because of the specifics of resource consent constraints and access issues, it may be easier to drill new wells.
Assumptions for Costing: A range of options was examined, ranging from drilling only one additional re-injection well (i.e. maximising use of existing wells), through to drilling 3 new production and two new injection wells. Pipeline lengths were based on retaining the present central power plant site, while noting that some form of distributed generation may be preferable and of lower cost.
Timing: The critical technical path would be on ordering additional binary generating units (about one year) and designing and building additional pipelines (similar and faster). Since the well capacities are known, these two activities could proceed simultaneously. If greater capacity is needed, more wells could be drilled which would cause several months delay, but the units come in modular sizes and staged development would be practical.
The resource consent process for this project is likely to take several years with no guarantee of success.
Constraints: The constraint is the need for resource consents, which are very restrictive because of perceived dangers to the thermal springs. However:
- The resource consents need to be renewed anyway- they are almost due to expire. Top Energy will be asking for an increased draw-off of 15000 tonnes per day (tpd), sufficient for another 15MW.
- There is now almost 10 years of monitoring data on which to more soundly base that decision. A reservoir modelling study has been carried out, based on the accumulated data, which indicates 25,000tpd of production is sustainable in the long term, equivalent to up to another 20MW (Total 30) depending on fluid temperatures and the plant configuration.
- The previous regulatory prohibition on lines companies for projects above 5MW limited the initial installation. Because of its isolation, Top Energy was successful in obtaining a special waiver for the existing 10MW plant. The latest government announcement (May 2003) will reduce such restrictions.
Environmental Issues: Increased air discharge (amenable to engineering solutions), effects on thermal springs.
3.3 Marsden Point
3.3.1 Marsden A
At Marsden Point there are two stations: the old "A" station which currently has a single 120MW steam turbine generator. (A second 120MW unit has previously been removed.) The boilers are no longer serviceable and the Unit A generator has until recently been used for synchronous condensing. Both chimneys have been knocked down. It would be possible to use the site and install, for instance, two 120MW General Electric frame 9 gas turbine generators (new or second hand). Each generator could be connected to an existing transformer and, in all probability, the gas turbine generator could be accommodated in the existing machine hall. Another option is to buy a gas turbine without the generator and couple it to the existing generator. This would probably be simpler, quicker, and cheaper but investigations would be needed to make sure that the unit was compatible.
We understand that the existing air discharge consents for the Marsden area are at their limit. New or revised consents would be required if more generation is to be installed.
3.3.2 Marsden B
The "B" station has a single 250MW steam turbine and oil fired boiler. The chimney has been knocked down but everything else has been mothballed and, as far as we understand, it would be possible to bring the station into service.
There are three options:
- Run the station on diesel fuel which would probably not require a new high chimney but would be expensive in fuel;
- Run it on residual fuel as designed. To do this it would be necessary to build a new high chimney;
- Run the station on coal. Studies show that this would be possible but that the output would be limited to about 175MW using the existing boiler. A new boiler would enable an output of 240MW.
Re-powering the existing steam turbine by adding gas turbines and heat recovery steam generators would be possible. There is currently no suitable gas supply to the site, but combined cycle operation on liquid fuel would be less expensive than for open-cycle gas turbines or reciprocating engine gen-sets. An optimised combined cycle plant would most likely be preferable.
Mighty River Power is currently progressing consent applications for Marsden B in a hydrofirming role and looking long term at a large thermal plant at this location.
3.3.3 Marsden - Summary
All Marsden options would be suitable for base load operation at a fairly high cost - especially those options using diesel fuel. The gas turbine option has an additional advantage that the units can be started quickly and therefore they would provide a backup to the isthmus transmission. It could be argued that these units could defer this upgrade by a number of years and that the value of this could be $20-30 million a year. It is difficult to say which option could be on line in the shortest time. It might be possible to get gas turbines on line in ten to twelve months but the B station options might take longer as a new chimney and a complete new instrumentation system are needed. Lack of a suitable gas supply at Marsden is an issue that would need to be addressed.
3.4 Marsden Point Oil Refinery
There is an option for cogeneration at the oil refinery, which could be approximately 20MW. It is understood that this has been investigated by one of the generating companies and could be implemented within 12 months.
3.5 Southdown Cogeneration Station
This station is designed to accommodate a third gas turbine and boiler and a second steam turbine. Subject to the consent process, a 40MW gas turbine without the boiler could be added very quickly (2-3 months) and the boiler and second steam turbine could be added later. The existing steam turbine is designed to take the steam from three gas turbines so the second steam turbine does not need to be an essential part. The existing boilers provide for supplementary firing which can be backed off when the third unit is producing steam. Mighty River Power is currently progressing consent applications for two LM6000 gas turbines at this site.
3.6 Huntly Power Station
Genesis has announced the E3P project, which consists of a 400MW combined cycle gas turbine plant. This project is presently on hold pending clarification of the longer-term gas supply issue.
There does not seem to be a potential for additional generation other than the E3P project, or a subset of it, but work on the Huntly power plant will be needed for the coalmine and for ash disposal.
The Government could consider facilitating a means for Genesis to order the generating plant now - before Genesis secures access to the Maui pipeline and gas supplies.
The output of the Huntly station is limited in the summer months by the conditions of an operating consent that defines maximum allowable temperature rise in the Waikato river over a stretch of river from the station to about 5 km downstream. These conditions will almost certainly prevent the station achieving full output of 1000MW next summer.
3.7 Kawerau Based Options
3.7.1 Gas Turbine
One of the generating companies has been talking to the paper mill about installing a Frame 6 Gas Turbine (40MW). This project would provide an excellent option for base load generation.
3.7.2 Additional Geothermal Using Existing Wells (Centralised Scheme)
It would be possible to make use of additional existing wells near the Mill site to add to the existing in-house generation. The precise capacity to do so is not known but would be around 15-20MW.
Another option is to consider using one or both of the second hand but totally reconditioned 2 x 23MW Elliot steam turbines and generators originally purchased for the Poihipi scheme and now owned by Contact Energy. These could be installed possibly within 12 months. By adding a back-pressure topping set their efficiency could be increased. Back pressure topping sets also remain an option for Tauhara or Ngatamariki, or expansion at Mokai or Rotokawa, though the commercial issues would have to be resolved
Assumptions for Costing: No new wells needed, some pipeline and roading.
Timing: Within 18 months, neglecting resource consent issues.
Constraints: Resource consents; new resource consents have been applied for, for the existing project, but are still being processed 8 years later.
Ownership and access; the wells are owned by the Crown and are probably about to be transferred to MRP (subject to resolution of some consultation issues with Ngati Tuwharetoa), but some of the wells are on private property. As with all geothermal resources in the Taupo Volcanic Zone, resource ownership (as distinct from well ownership) is subject to a Waitangi Tribunal claim.
Environmental Issues: Possible subsidence at the Mill site and town, minor air emissions.
3.7.3 Additional Geothermal Using Existing Wells (Wellhead Scheme)
It is possible to make use of existing geothermal wells using low cost, rapidly installed wellhead generators. There are usually run by back-pressure turbines with atmospheric exhaust, which are often designed to be portable. Mexico has the most extensive experience in the use of such plants, but they are commonly used elsewhere. Individual units can be 1 to 5MW in capacity. The precise number of unused but productive wells at Kawerau is not known.
A preliminary estimate indicates that the potential additional capacity may be approximately 10MW.
Assumptions for Costing: No new wells and only very short pipelines, apart from some small reinjection pipelines. Note that although the cost per tonne of steam is much less than for a condensing plant, the output is also less so the unit cost per MW is about two-thirds.
Timing: They have the advantage of being lower cost and faster to install than a centralised plant. Because they are portable, they are often available second hand, and therefore quick to obtain. Six months if available second-hand, 12 months if not.
Constraints: As for centralised plant, plus relatively inefficient use of the resource (50% that of condensing plant if used alone, though they can be retrofitted with binary units as condensers) and greater environmental impact. More complex to connect to transmission grid because of distributed nature.
Environmental Issues: As for a centralised plant, plus greater noise and steam emissions.
3.7.4 Additional Geothermal Using More Binary Plant
There are two existing binary plants operated by Bay of Plenty Electricity, running on waste separated water from the main Kawerau geothermal scheme. These could be duplicated to make use of all of the available hot water with the potential for possibly another 5MW.
Timing: About 12 months would be required to purchase and install binary plant and piping.
Constraints: In this case, resource consents are almost certainly not an issue as the plant would make use of a waste stream for which consents are already held (though see comments above about current uncertainty). Land access for sufficient re-injection capacity may be an issue. Contractual issues between the Crown (shortly to be MRP) and BOPE/Todd would have to be resolved.
Environmental Issues: Net positive environmental impact, as it will lead to greater re-injection of waste water with no increase in resource usage or emissions.
3.7.5 New Putauaki Geothermal Project
Mighty River Power is investigating the development of a 50-100MW geothermal power plant on the Putauaki Trust land at Kawerau. This could be a separate geothermal project, or it could be linked in some way into the existing project. None of the wells has yet been drilled, so there is some resource uncertainty.
Assumptions for Costing: Costed as a full scale, stand-alone geothermal project.
Timing: From a technical viewpoint alone, and under optimum circumstances, it would be possible to have 50MW available in 3 years and 100MW in 4 (and possibly some wellhead generation in 18 months or so). However, it is expected to take at least 5 years for the project to generate power, allowing for the consenting process.
Constraints: Resource uncertainty, resource consents (not even consents for drilling are held at present), possible subsidence.
Environmental Issues: Subsidence at the Mill site and town (but probably less so than for an expansion of the existing scheme), air emissions.
3.8 Rotokawa Geothermal
The current facility is of 33MW capacity. The ultimate capacity of the field is large, certainly well over 100MW, and its relatively remote and insensitive location makes it attractive from an environmental point of view. Further expansion will require new drilling. There is one unused productive well but is on the other side of the Waikato River with no re-injection well available.
Further development is resource consent limited.
However, the current project is a joint venture between Mighty River Power and a Maori trust that owns only part of the land over the geothermal resource. A different Maori trust owns much of the remaining land over the proven part of the resource. To fully develop the field it would be logical to involve all of the major landowners. They are not necessarily averse to geothermal development, but it would take time to negotiate. There is also land administered by DoC.
Hence it has somewhat arbitrarily been assessed that another 75MW could be developed without involving a third party, but that to develop beyond that would take more than the four-year time frame considered here.
A further option is to add additional heat exchangers to the existing plant to drop the outlet temperature, and add another binary unit(s). That may yield another 3MW or so.
Timing: Given that the resource is proven and fairly well understood, and a plant and transmission already exist, it would be technically possible to have an additional 78MW in production within 3 years, ignoring resource consent constraints. If the project proponents were prepared to take the risk of pre-ordering the plant before the wells are drilled (thus raising the possibility that the plant may not be fully optimised), it may be possible to trim 6 months from that schedule. However, it expected to take at least four years for the project to generate power, allowing for the consenting process.
Additional heat exchanger/binary capacity could be installed with 12 months.
Constraints: Resource consents, land ownership issues for development beyond 100MW.
No resource consent issues for adding additional heat exchanger capacity to the existing plant. However, there is a real issue with silica deposition, which is worse at Rotokawa than at the other fields because of the high resource temperatures. This problem is solvable, but would require the use of technology new to New Zealand and additional cost - see discussion under Ohaaki.
Environmental Issues: Air emissions, some disturbance of existing thermal activity, which is designated as "Significant" in the most recent draft of the Waikato Regional Plan. Both effects, in the opinion of SKM, are of relatively minor significance, and the unpopulated but elevated nature of the area means that subsidence is not a major issue as at many Taupo Volcanic Zone (TVZ) fields.
No environmental issues for additional heat exchangers.
3.9 Mokai Geothermal
Current capacity is nominally 60MW but it can generate a little more in the winter. An additional 30MW is possible within the resource consents in terms of production and re-injection. Tuaropaki Power Company (TPC), which owns the site, is committed to an additional 39MW development.
It would be possible to further develop the field, by at least another 50MW, but there are potentially problems in that part of the land over the resource is owned by Contact Energy, which is a competitor to TPC. It is assumed that resolution of that issue would take more than 4 years.
A further option is to add additional heat exchangers to the existing plant to drop the outlet temperature, and add other binary unit(s). That may yield another 5-8MW or so. The option is more attractive than at Rotokawa because of the large existing capacity and slightly lower resource temperatures, hence less of a silica problem.
Timing: It should be possible to get an additional 30MW operating within 2 years (and some could be on line earlier.
This assumes that the expansion project follows TPC's stated intention, which is to add more Ormat brand plant. It would also be possible to use the existing lower cost Elliott plant. Provided the commercial issues could be resolved, it may be possible to reduce the schedule by a year.
Additional heat exchanger/binary capacity could be installed with 12 months.
Constraints: Beyond the planned 30MW expansion, resource consent and land ownership issues. No major environmental issues, though additional air emissions would have to be considered.
3.10 Ohaaki Geothermal
The existing plant and steamfield has an installed capacity of about 80MW. Because of a limited steam supply, it is operating at about 30MW. Recent deep drilling has been successful in maintaining the current level of output, and further deep drilling should be able to restore the plant to full capacity in the medium term at least thus providing another 50MW. One deep well is being completed at the time this report was being prepared, but as far as we are aware, there are no plans for further deep drilling after that. Resource consents exist for the full capacity, so this is one geothermal option where resource consents are not a constraint.
Adding a binary plant to use the energy contained in the separated brine at Ohaaki would possibly give another 10MW. It is understood that Contact is exploring options along these lines. A binary plant at Ohaaki is not quite as simple as at Wairakei, as there is a greater potential for silica deposition.
Assumptions for Costing: Extra production and some new reinjection wells would be needed, but very little in the way of piping and no extra power plant.
Timing: Restoring the capacity could be quite rapid, as the steamfield was built for 112.5MW and by using directional drilling techniques, wellheads could be advantageously located. If a minimum cost schedule was followed, Contact would wait until a large drilling rig was mobilised for other purposes such as drilling planned at Mokai and Rotokawa, which would mean at least a year before the full capacity was achieved. However, if an aggressive drilling schedule was followed, involving greater cost, it would be possible to mobilise two or three rigs and get the wells drilled and connected within 6-9 months. Each well could be connected incrementally as it was completed, so the first power could be available within 4 months.
Constraints: Subsidence from the existing operation has been severe leading to flooding including at the Marae. The air emissions are also large. However, these environmental effects are already permitted as resource consents are held for the full output.
The binary plant would require resource consents (though the actual environmental impact of it is trivial) and would take a year to order the equipment and install.
The silica deposition issue for a binary plant would need to be addressed, but is solvable.
Environmental Issues: Increased air emissions, increased subsidence.
3.11 Wairakei-Tauhara Geothermal
The situation at Wairakei-Tauhara is complex, hence all options are listed here to aid understanding, even if some do not offer any potential for overall power increases.
3.11.1 Wairakei Existing Plant
The existing Wairakei plant is currently producing up to 170MW with a high availability factor. It is limited by steamfield capacity. There are a few unused productive wells that, from a technical point of view, could be connected, and the plant is running below the capacity of the current resource consents, by about 20MW or so. However, the consent situation is also complex, in that half the Wairakei capacity is consented to 2013, but the other half expired in 2001. Contact has applied for an extension of the consents, and continues to operate until the application is resolved - which could take at least 5 years.
There are significant real environmental issues at Wairakei, and strong opposition to the current application for renewal and expansion. In our opinion it is unrealistic to expect any increase in capacity at the existing plant.
Timing: It is likely Wairakei will be able to keep operating as it is until the end of 2005, but then possibly have to cut production.
Constraints: Resource consents, environmental effects, some resource depletion in part of the field, commercial competition and strong opposition to the current consent renewals.
Environmental Issues: Subsidence and hot ground hazards including in the Taupo urban area. Effects on the Waikato River through discharge of separated water and use of the river for direct contact cooling. Minor issues over air discharge.
3.11.2 Wairakei Binary Plant
Capacity/Description: Contact Energy is issuing documents for a 15MW binary unit to make use of the separated water from the existing Wairakei plant. Contact Energy already holds resource consents for this purpose.
Assumptions for Costing: No extra wells are needed, minor piping only. Standard binary plant.
Timing: Within 12 months from placing an order
Constraints: None, other than the issue that if the main Wairakei plant has to cut production after 2005, it will reduce the fluid available for the binary plant pro-rata.
Environmental Issues: None. It may have a positive environmental benefit if it provides an opportunity for greater re-injection.
3.11.3 Poihipi Geothermal
The Poihipi plant is owned by Contact Energy. It draws on the same resource as the Wairakei plant.
Poihipi has a 55MW capacity and is connected to wells that can provide sufficient steam for 33MW, but is limited due to a particular restriction in the resource consents. Currently the plant is run as a peaking plant and it only operates at 33MW approximately to thirds of the time. In the short term it could be possible to run Poihipi at 33MW continuously, albeit with some possible environmental disbenefits. Two significant advantages of this option are that it could happen immediately, and at zero cost.
In the short term at least it would not be detrimental to the main Wairakei plant to do so.
In the medium term, it would be possible to restore Poihipi to full 55MW output by drilling additional shallow wells, but this would not be sustainable for more than a few years because of the limited land area available under the current resource consents and localised resource depletion.
An alternative would be to connect the Wairakei steam field to Poihipi to make the best use of the available steam.This could permit Poihipi to run at full load without compromising the reservoir. An under (or over) road crossing and interconnecting piping would be required. Two more wells at Te Mihi might be required. While Wairakei has sufficient spare resource consent capacity to do this, a variation may be needed to either the Poihipi or Wairakei consents to change the area to which they apply and/or their purpose.
The first option would effectively provide approximately a 22MW increase in output, and the second option about 28MW because of greater availability and higher pressures.
Assumptions for Costing: Zero incremental capital and operating cost for the first option, some wells and piping required for the second. The costs shown in the summary matrix represent the range between the options.
Timing: Running at full load - Immediate (subject to resource consents).
Drilling and/or connecting Wairakei and Poihipi steamfields - approx 6 months (subject to resource consents and other regulatory and legal issues)
Constraints: Resource consents, but the changes required are minor compared to the current outstanding application for renewal and extension of the Wairakei consents, and it may well be possible to get them resolved more quickly, especially as a short term measure.
It is worth noting that the resource consent condition which limits full output at Poihipi is not on the total quantity (which is adequate for 55MW if taken as dry steam): it relates to the amount of steam that can be taken from a certain depth. The reason for imposing that restriction was concern over the possible effects on the Karapiti thermal area as a tourist attraction, not concerns about other environmental effects or resource capacity. However:
- The restriction was imposed before the station was commissioned in 1996. As the effects on Karapiti so far have been minimal, there is a good case to revisit it.
- The Karapiti thermal area is entirely artificial anyway, caused by past exploitation at Wairakei. It definitely has a limited life and in the worst case greater steam extraction at Poihipi would only accelerate its decline.
- Steam zone pressures are running down - that part of the field is already being exploited non-sustainably. It is simply a trade off between mining the steam now, or in a few years time.
Geothermal reservoirs do not respond instantly to extraction. A short-term increase in extraction to get us through the winter could be compensated for by a reduction later, possibly with little incremental effect over a year or so.
Environmental Issues: More rapid run-down of the shallow steam resource, effects on the Karapiti thermal area, possibly a small increase in the rate of subsidence locally, but probably no net increase in the longer term. Otherwise, little net effect.
3.11.4 Tauhara Geothermal
The Tauhara geothermal resource is adjacent to the Wairakei resource and hydrologically connected to it. There is a current resource consent held by Contact Energy. However this will lapse at the end of 2006 if it is not exercised. The current plan is for 15MW of electricity generation plus some direct heat use, but the generation could probably be increased to 20MW by reducing the industrial heat available (and as far as we are aware no firm users of that have yet been identified). Possibly one of the two 23 Elliott steam turbines (originally purchased for Poihipi and now owned by Contact) could be utilised at Tauhara.
Assumptions for Costing: some additional wells required, actual pipeline layout as defined by Contact. Condensing or combined cycle plant.
Timing: Something must happen by 2005 if the consents are not to lapse. Three of the deep wells already exist so drilling is not on the critical path. If one of the Elliott units which are already in the country were used, it could probably be on line within 12 months.
Constraints: There is a problem of serious subsidence in the town area, a problem that will be exacerbated by the Tauhara plant, but as the project is already consented this does not impose a constraint on it going ahead. A building consent would have to be obtained.
Environmental Issues: Subsidence, increases in thermal activity, air emissions, noise, but consents have already been issued.
3.11.5 Geotherm Group Scheme
The Geotherm Group has submitted a resource consent application for another station of 50MW or so, tapping the same resource as the Poihipi, Wairakei and Tauhara plants. There are mutual objections between Contact Energy and Geotherm to each other's resource consent applications.
It is hard to predict the outcome of the application. Hence we do not think the Geotherm application, even if successful, should be regarded as giving a net gain in national generation capacity by 2005, and it has not been included in the analysis. This should not in any way be taken to indicate that SKM is attempting to pre-judge the outcome of the current applications, nor is favouring one scheme over the other.
Timing: Technically, it would be possible to have the scheme operational within 3 years. However, resolution of the resource consent issues is likely to take considerably longer.
Constraints: Resource consents, litigation, environmental effects. Some uncertainty over resource capacity - the project is on a marginal part of the field.
Environmental Issues: Subsidence and air discharge effects, but significantly less serious than for the same number of MW through the Wairakei scheme as the Geotherm scheme proposed full re-injection. Possible effects on Karapiti thermal area.
3.12 Reporoa Geothermal
The Reporoa geothermal field has already been drilled, though resource temperatures so far encountered are not as hot as in some other areas, and the resource cannot be regarded as fully proven. SKM have previously assessed the capacity at 42MW for electrical generation. For the purpose of this study a capacity of 40MW has been assumed. However, there is a significant opportunity for substituting for gas for process heat, as located above the field, there is a large dairy factory that includes a gas-fired whey to alcohol and distillation plant. The equivalent capacity is not known but would presumably be at least the equivalent of 10MW of electricity, and it would be a far more efficient use of the resource.
Assumptions for Costing: Stand-alone geothermal scheme requiring all new wells and piping, condensing or combined cycle plant.
Timing: From a technical consideration only,, direct use substitution for gas could be in place within a year. Full scale integrated development including electricity generation could be in place within 4 years.
Constraints: Resource consents. An application for resource consents has been declined by Environment Waikato. Some uncertainty exists over resource temperatures, but this would not matter for direct use. SKM assesses the actual environmental impact of this development opportunity as quite low.
Environmental Issues: Perceived effects on Waiotapu (in SKM's view, almost certainly not the case), minor subsidence but in a little-populated area, air emissions.
3.13 Ngatamariki Geothermal
Four wells were drilled at Ngatamariki, proving a moderately large, hot resource. Two of the wells are productive and the others to could be used for reinjection. SKM's best guess of the capacity is about 120MW. 100MW has been assumed for the purposes of this study. Mighty River Power has joint rights of land access for geothermal development with Fletcher Forests, and is probably about to take over ownership of the wells, but has not applied for resource consents. Wellhead generation may be a better option in the short term (see below).
Timing: From a technical point of view, the full scheme could be operational within 4 years as some wells already exist. However, it would take several additional years for the consenting process to follow its course.
Constraints: There is some uncertainty over the ultimate size of the resource, but it clearly exists. SKM is of the view that the proposed Waikato Regional Plan practically precludes development at this time, whereas the assessed likely environmental impact is minor.
Environmental Issues: Possible subsidence and air emissions, but in an unpopulated area. Effects on thermal features, but they are not currently accessible to the public or particularly unusual.
3.14 Other Wellhead Generation Geothermal Options
As at Kawerau, additional unused but productive geothermal wells exist in various places, which were drilled by the Crown but are probably about to be transferred to MRP. Such wells exist at Ngawha, Kawerau, Wairakei-Tauhara, Rotokawa, and Ngatamariki. Those at Ngawha have not been separately considered but remain a possibility. Kawerau has already been discussed. Wairakei wells are not considered further because of the resource consent issues, and the Tauhara wells have already been dealt with above. One well (RK6) exists at Rotokawa on the opposite side of the Wairakei River to the existing scheme, and so would probably be better separately developed. This would most logically be done by the existing Rotokawa joint venture. Two productive wells exist at Ngatamariki, and there are two other wells available for reinjection. Wells which demonstrate the resource characteristics also exist at Waiotapu, Reporoa, Mangakino, Atiamuri and Rotoma, but were either not sufficiently productive or have been cemented up and are now unavailable.
It is considered that an additional 12MW using wellhead generators may be achievable from existing wells, but that is an alternative to the other options already discussed, not additive to it. It has been retained in the summary table (but not included in the total), to demonstrate the timing and cost opportunities if very rapid action is considered necessary.
Assumptions for Costing: No new wells required, except where no reinjection is known to exist (e.g. Rotokawa). Very limited production piping, but some reinjection piping needed. Back pressure power plants.
Timing: Technically possible within one year, or faster if second-hand plant can be obtained. Longer, given need for the consent process.
Constraints: Resource consents, plus relatively inefficient use of the resource and greater environmental impact. More complex to connect to transmission grid because of distributed nature.
Environmental Issues: As for a centralised plant, plus greater noise and steam emissions.
3.15 Whirinaki
Contact Energy has consents for a 150MW combined cycle unit on the old gas turbine site. It would be relatively straight-forward to bring in new gas turbines and put them on the existing foundations and connect them to the grid. This could provide up to 150MW but they would be operating on diesel fuel and quite expensive. Marsden may be a better site, but Whirinaki could be quicker.
3.16 Te Rapa and Te Awamutu Dairy Sites
These sites may have some potential for additional generation and further information is needed to clarify the extent. Both plants have the ability to be run in open cycle mode when the dairy factory is shut down.
3.17 New Plymouth Power Station
Contact is converting four units for oil firing in June.
3.18 Wind Generation
TrustPower has approval to proceed with the extension of the existing Tararua Wind farm development. This will increase the installed capacity by 36MW in July 2004 and provide a total output of 125GWh per annum. The first wind generator unit (660kW) is scheduled to commence operation in December 2003.
Meridian has announced that it is seeking consents for its Te Apiti wind farm in the Manawatu. This project is expected to have 55 turbines of total capacity between 82.5 and 96.25 megawatts. If resource consents are granted in 2003, construction could begin in 2004 with the first turbine producing power in late 2004. Full production capacity would be achieved in early 2005.
Genesis is developing an additional 5MW at its Hau Nui, Martinborough wind farm due on line in 2005.
It is understood that additional wind projects are planned in the South Island, and Northland areas in the longer term.
3.19 Taranaki Combined Cycle Plant
It may be possible to run the unit on Kapuni gas either with or without some stripping of Carbon Dioxide. The unit is supposed to be able to run on diesel fuel. However, problems exist with the present combustion system and GT26 technology. Further development will be necessary before liquid fuel firing is possible.
It may be well worth while making sure that the option of using some Kapuni gas at TCC is investigated so that it can be implemented in the event of a serious shortage of Maui gas or of electricity.
3.20 Kiwi Dairy, Hawera
There is potential for 40-80MW of additional generation using Kapuni gas. A 40MW gas turbine with a waste heat boiler would provide 50MW of additional electricity for export and also provides process steam for peak demand that is currently being produced by conventional gas fired boilers. Some of the steam would be passed through an existing steam turbine before being used in the factory. This may increase the plant output by an additional 10MW. There is also a possibility of an additional 40-60MW in the form of a combined cycle unit on the site with all the steam being used for power generation. Much of the infrastructure needed for the first 40MW unit is in place.
To export this amount of power, a 220kV connection to Hawera substation is needed. A tee off from the Stratford- Waverley 220kV line using a 220/110kV transformer from Marsden could be a quick fix. Alternatively a new to 220/110kV substation could be built close to the 220kV line and the existing 110kV lines to Hawera 110/33kV substation could be extended to connect to the new substation. Either would take 1.5 to 2 years.
Alternatively, the 40MW combined cycle unit could be installed at Kapuni.
The first 40MW unit could be in service in 1.5 to 2 years and the second combined cycle unit could be in service a year later.
We are not sure of the implications as far as resource consents and the like are concerned but there is no doubt that there would be some problems with the building a new transmission line. Providing cooling water for the combined cycle unit may also raise some problems.
3.21 West Coast Coal
Solid Energy is investigating installing power generation capacity at Westport. At the present time it is understood that the proposed plant size is limited to 100MW because the 110kV line to Westport has limited capacity. However, the coal resource is understood to support a plant of at least 300MW. There is a 220kV line to within 20 km of the site that now operates at 110kV. It is double circuit construction with only one circuit strung. It was built for a proposed 500MW coal fired station in the 1970s. If a station larger than 100MW is to be built, then it will be necessary to extend the 220kV line and build new substations. This could add several hundred million dollars to the cost of the power station. On the other hand, if the station is built, its location in the North of the South Island will relieve transmission constraints between Stoke and Christchurch and, possibly, between Christchurch and Benmore. This could well offset the cost of extending the line to the power station.
This station would provide the some much-needed hydro firming capacity so it would be operating at maximum output when the hydro generation was limited. Its location in the South Island may ease existing North Island transmission constraints by reducing the need to transmit power from the North Island to the South during drought. However, if the station is needed to operate at the maximum output when the hydro stations were operating at normal or higher outputs, and exporting to the North Island, it could load the DC link to beyond its current capacity. However, this scenario is only likely to occur if there were major problems with thermal generation in the North Island.
There would be considerable work needed to get the station through the Resource Management Act process. Emissions, cooling water supplies, Kyoto and the uprating and construction of the transmission line extension are all likely to attract objections and result in delays.
3.22 Hydro Power - Introduction
New Zealand has at least 1000MW - and possibly 2000MW - of additional hydropower capacity, which may be economic and has limited environmental impact. The most recent studies were done 15-20 years ago. To determine the order in which schemes should proceed - and those that should be ruled out - a comprehensive study of hydro resources is needed. This study would review existing reports and, where necessary, revise them in the light of the latest information, and using modern technology in civil works and mechanical and electrical generating plant. It also needs to carry out more detailed studies of schemes that have been proposed but not investigated in sufficient detail to provide reliable cost estimates.
Such a study will provide the information we need on size of the resource, the costs of hydropower, and the environmental impact, so that hydropower can be properly compared with other sources of energy.
3.23 Contact Hydro Power
Contact could develop Luggate and Queensbury (~250MW) and a 60MW and a 30MW scheme based on Lake Hawea. Existing studies need to be reviewed and updated so that a rational plan for development can be contemplated.
The 30MW scheme at Hawea consists of replacing the existing works used to control the discharge from the lake with a 30MW hydropower scheme. Its environmental impact would be minor. We understand that the 60MW scheme is at the proposal stage. It diverts the water downstream of the 30MW scheme and conveys it by canal across country where it would finally enter a 60MW power station on the Clutha river. As it involves diverting water from the short length of river between Hawea and the Clutha and also extensive earth works for the canal, the Resource Management Act process is likely to be time consuming. While the 30MW scheme could be completed in 2-3 years, the downstream 60MW scheme is likely to require 4 years or more.
The Luggate and Queensbury schemes have been extensively investigated and comprehensive feasibility studies have been carried out. However, we understand that the dam site for the Luggate scheme was fixed before sufficient investigations had been carried out and, if this development is to proceed, consideration should be given to another dam site which is believed to be much more beneficial.
We understand that Contact already owns the land that these schemes would require so it may be possible to get through the approvals procedure relatively rapidly. If everything proceeds expeditiously, it might be possible to have the schemes on line in four to five years. The schemes will need to export over new 220kV lines so the transmission aspects will add some costs and may cause delays.
From the information we have been able to obtain, we would expect that all these schemes would be economic - or close to being economic - at current and expected power prices.
3.24 Meridian Hydro Power
Meridian has planned efficiency improvements at Manapouri lake control that will provide an increase of 20GWh in 2003 by lowering the outlet sill, thus increasing the lake operating range. Turbine runner upgrades are planned which will provide a 70GWh gain by 2007. If the station is allowed to increase its maximum discharge into Deep Cove to match the potential capacity of the station, it will be technically possible for the station to reach its maximum capacity of 840MW with an estimated annual further increase of 30GWh. (It increases the station energy generation because it will reduce spill during periods of high rainfall.) From a technical point of view, the additional generation achieved by increased discharge is a zero cost option.
Recently, Sinclair Knight Merz assisted Meridian to carry out a review study, which identified 35 projects within the existing Meridian controlled areas. The most attractive options are uprating Tekapo B by 20-30MW and building a new station at Pukaki dam. This would have an output of about 40MW when the lake was full.
Tekapo B can be up-rated by installing new runners in the two existing turbines and removing output constraints imposed by the canal and penstock capacity and the mechanical limitations of the rotating plant. This would have the effect of increasing the efficiency of the turbines and would also increase the output of the station by 20-30MW. This upgrade also has the advantage of increasing the rates at which water can be transferred from Lake Tekapo to Lake Pukaki, which would reduce spill from Lake Tekapo. It was comprehensively investigated about eight years ago and found to be marginal at the power prices at that time. With current and expected power prices the scheme should bring a very positive return.
The Tekapo B project will not require any approvals as all the work will take place inside the power house. The project could be completed in about two years.
The installation of a 44MW bulb turbine at Lake Pukaki dam was investigated about ten years ago. It would bypass the existing control structure that discharges into the Ohau canal. At that time, it was not economic and not proceeded with. However, since then power prices have increased and we also believe that should be possible to achieve considerable savings in civil works costs by adopting a different design philosophy. There may also be cost savings in generating plant resulting from advances in technology and cost reduction in the manufacture of large bulb turbines.
Meridian has also investigated generation options based on using the existing control structure. This option may generate 20-30MW from the same resource.
The Pukaki scheme may require only limited approvals as it is within an area designated for power generation and on Meridian owned land. It could be completed within three to four years.
Meridian has recently commenced the consent application process for the development of Project Aqua. This is planned to bring on 270MW of Hydro capability in 2009 and another 254MW in 2011.
3.25 TrustPower - Hydro Power
TrustPower has proposed Hydro developments in the Upper Part of the South Island, schemes that are subject to resource consents.
The Wairau Valley scheme in Marlborough area is an extension of the existing Branch hydroelectric scheme. The proposed 115MW installed capacity will generate about 500-550GWh per year subject to outcome of RMA consent process. Increased local generation will enable the supply of peak load without importing electricity to the region. The project appears to have strong public and regional support. Commissioning is scheduled by end of 2006.
The Dobson Hydro Scheme, if issues relating to DoC land can be resolved, and if consented, would increase generation capacity on the Arnold river from 3MW to an estimated 62MW by using the water more efficiently. Dobson would generate about 270GWh per annum. The Inchbonnie/Lake Brunner scheme, a potential future extension of the Dobson scheme, would yield about 153GWh in total, including some 90GWh additional generation output at Dobson and 63GWh at Inchbonnie.
The concepts of these schemes have been well developed and TrustPower is undertaking a public consultation process.. If the Dobson project is approved, construction could commence in 2005 and the project would be operational by December 2007.
3.26 Coal Seam Methane
There are currently two joint ventures investigating Coal Seam Methane opportunities. A Solid Energy joint venture has identified sites at Kaitangata and Huntly, and drilling at Huntly. A Mighty River Power joint venture is looking at other sites in both North & South Islands. A pilot project would require approximately five wells to be drilled and could deliver approximately 10MW of generation using gas engines within six months, subject to regulatory constraints. A further 60MW of generation could be developed over next two or three years.
3.27 Industrial Cogeneration
Opportunities exist for further industrial cogeneration, but the implementation time for these is typically two to three years. A list of these prospects is included in Appendix B.
3.28 Substitution of Geothermal for Gas
There is one industrial site currently burning gas for steam production that may be able to utilise geothermal steam. This is the Reporoa dairy factory as discussed in 3.12 above. This would permit some gas to be freed up for generation.
Other possible sites to be investigated are timber processing plants in the Taupo / Rotorua district - geothermal steam could be used for timber drying and in board manufacture. Some of these plants currently burn gas to raise steam.
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