Consultation on Preferred HVDC Replacement Option

Media release

31 January 2008

Consultation on Preferred HVDC Replacement Option Begins

Transpower will begin the first vital stage of replacing Pole 1 of the High Voltage Direct Current (HVDC) inter-island link when it begins public consultation tomorrow on the shortlisted replacement options.

The HVDC link consists of Pole 1 and Pole 2. Pole 1 includes equipment that is 42 years old and has been stood down pending work to return half of the Pole to a standby state for use in critical periods. Pole 2, which was commissioned in 1991, continues to operate reliably and has been uprated to carry additional electricity since Pole 1 was stood down.

Transpower has assessed the short-listed replacement options under the Electricity Commission’s Grid Investment Test to determine a preferred option. That assessment shows that a 700 MW replacement pole is preferred compared to the other short-listed options which include a new 500 MW pole or a new 1000 MW pole.

Transpower’s Chief Executive Patrick Strange said that Transpower will now consult on the results, as required by regulation.

“We are looking to the future and want to progress the HVDC replacement as quickly we can.

However, this is a major transmission investment, and discussion with industry and other interested parties will help ensure that we have reached the right answer.

“What the Grid Investment Analysis has shown is that a Pole 1 replacement stacks up economically. The benefits by way of facilitating competition in generation and connecting renewable generation are significant, and this shows up in all three new pole options."

All documentation, including the results from the Grid Investment Test, the assumptions and option selection process will be available from the Grid New Zealand website www.gridnewzealand.co.nz on 1 February 2008.

When the current round of consultation is completed on 4 April 2008, Transpower will consider all submissions with a view to submitting a final HVDC replacement investment proposal to the Electricity Commission in May 2008. Assuming the proposal is approved, a new pole would be commissioned in 2012.

Transpower continues work to restore half of Pole 1 to an acceptable operational state as back up during times when the supply of electricity is constrained. This would help maintain security while the new Pole was being built.

ENDS

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