Dry Year Generation

2 October 2003

2 October 2003

MEDIA RELEASE

Dry Year Generation

Orion New Zealand, the lines company serving Christchurch, central Canterbury and Banks Peninsula communities announced today that it was intending to install up to 35MW of diesel powered generation plant around Christchurch to assist with government’s call for extra “dry year” generation capacity to ensure security of electricity supply.

“This amount of capacity represented about 5% of the maximum winter load experienced by the Orion network, and also about 5% of the government’s immediate requirements to provide extra power generation in the event of a “dry year” reducing the output of existing hydro electric stations, particularly in the South Island”, said Roger Sutton, Orion’s Chief Executive Officer.

The power plants are to consist of high efficiency / low emission packaged diesel generator sets with up to eight units located at three industrial sites around Christchurch; at Belfast, Bromley each and a third location yet to be determined, with an overall capacity of approximately 10MW at each site.

The generators will normally only run for short time periods during daylight hours in the winter, in normal hydro inflow years. This will assist in meeting short term peaking loading on the network, usually caused by commercial and domestic space heating on cold winter days.

When hydro inflows become critically low as has happened in earlier years, the generation plant will be operated for extended periods during such periods of water shortage.

Security of electricity supply to Christchurch businesses and homes was a top priority for Orion said Mr Sutton. “We want to play a responsible part in assisting the government with its dry year generation reserve incentive with a contribution in proportion to our overall size in the New Zealand electricity supply industry. A secure supply of electricity into Christchurch was vital in allowing alternative electric (to solid fuel) heating sources to displace open fires and the older less efficient solid fuel burners.

The generators being the containerised portable type were different from other recent proposals in that they had the advantage of being able to be relocated in case of civil or other emergencies when emergency power was needed because of damage to the existing network.

Another big advantage in local embedded generation within the Orion network was the potential to reduce transmission and distribution losses, particular in times of overall energy shortage.

“Orion was about to apply for appropriate notified resource consents for land use and air discharge.”

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