Wednesday, January 12, 2005

Energy: the growth of wind

There's an interesting article in the Dominion-Post this morning on the growth of wind power in New Zealand. Between them, TrustPower and Meridian are planning to install 450 - 500 MW of turbines in the next two to three years, and there are many other projects being pursued by smaller players. In all, it looks as if we will be able to meet our energy demand growth from wind alone - which has to be good for our long-term sustainability.

Why such intense interest? One reason is the ease of gaining resource consents. While some object to windfarms on the basis of noise and visual pollution, others find them quite beautiful, and public support for new projects is generally strong. Meridian's Te Apiti windfarm near Palmerston North reportedly took just three days to get its resource consent, and their planned farm near Mossburn took only eight. Compare this with the expensive multiyear struggle over Project Aqua...

But the real reason is even simpler: generating electricity from the wind is now economically viable in New Zealand. Good wind resources mean that New Zealand wind farms are over twice as productive as those in Europe - and almost approach hydro in terms of capacity (Trustpower's Tararua farm generates 45% of the time, Te Apiti approaches 50%. Hydro averages only 58% due to variable rainfall). This means that wind electricity is cheap - Meridian thinks it can generate for less than 6 cents per kWh, even cheaper than gas. And while the government is providing carbon credits to promote clean generation, these are "icing on the cake"; these projects are being pursued because they are commercially viable on their own terms.

It is interesting however to note which of our electricity companies are catching the wind and which are not. Wind seems to be being pursued by generators with most of their assets in hydro, because of the obvious synergy (you can generate with wind and save water for later). Those companies with large sunk investments in gas, OTOH, seem to be ignoring it and betting everything on imported LNG. The latter, I think, are setting themselves up for an expensive fall in the long run. With the price of gas set to rise as Maui runs out, and rise further to pay for LNG infrastructure, there will be a definite incentive to conserve at peak times rather than risk exposure to the spot market. And this is going to decrease the demand for gas even further. It won't disappear, but it will almost certainly play a smaller role in our national grid than it does at present.


wind power is a crock. you need back up capacity in the form of hydro or gas because wind is not on demand. when the cost of this is factored in wind becomes uneconomic.
your comparison of % of capacity is completely misleading because it does not allow for the on demand aspect.
the time taken to get resource consents is outrageous. a complete abuse of process to favour a fashionable generation method. if the process was democratic it would have taken the same time and had to leap the same hurdles.

Posted by sagenz : 1/15/2005 07:52:00 AM

Of course you need other generation methods in your mix - that's not in dispute. No-one is suggesting a hundred percent (or even fifty percent) reliance on wind. But what they are saying is that it is going to be an extremely valuable part of our mix, and the basis of a serious shift to a greener generation mix on average.

As for wind not being on-demand, of course it's not - but when it is steady enough to be almost as productive as a hydro installation, it matters a lot less. We have a large amount of on-demand generation already, and increasing the proportion generated by wind allows it to be used more effectively. In particular, every GWh generated from a wind-farm is one that our dams can save and use later. Given our lack of hydro storage capacity and recent dry-year problems, I would think that the advantages of this would be obvious.

(It is also gas or coal you don't have to burn - but if you're in a "take or pay" situation, then that's no advantage whatsoever, which explains Contact's disinterest. With such a heavy investment in gas, building windfarms (or any form of non-thermal generation) would simply cost them money...)

With regards to the RMA, the process isn't stacked, and wind farms have to leap the same hurdles as any other project. The difference is precisely due to the democracy you claim is absent: fewer people object, and those that do don't object strongly enough to turn it into the sort of drawn-out shitfight we saw over Aqua. As an example of this public support, 90% of the submissions on the Mossburn project were in favour. Is it any wonder then that the consent hearings are resolved quickly?

There have also been fewer challenges in the environment court. I know of only one successful wind-farm application which has been appealed, and that was Windflow's test turbine near Christchurch; it was successfully resolved without having to go to a hearing.

Posted by Idiot/Savant : 1/15/2005 10:51:00 AM