New Zealand Geothermal Plant to Triple Output

Kaikohe, New Zealand-based network company, Top Energy, and Wellington, New Zealand-based electricity retailer, Contact Energy, have signed a new agreement that will assist Contact Energy to better manage the electricity needs of its Northland customers, using locally generated geothermal power from a plant in Ngawha Springs.

Ngawha Springs, New Zealand – December 30, 2003 [] The deal secures Contact Energy’s rights to buy all electricity generated at Top Energy’s Ngawha Geothermal Electricity Generation Plant for the next three years and includes a right of renewal option for a further two-year period. There are plans to almost triple the Ngawha station’s output and Contact has the right to buy the additional power. Contact Energy retails electricity to around 90 percent of Northland power consumers, who are connected to Top Energy’s lines network. “Supply to Northland is sometimes affected by transmission constraints as electricity is distributed from farther afield on the national grid,” said Contact Energy Key Account Manager Bryce Croom. “Because Northland is at one end of the national grid, quality and security of supply can be disrupted.” According to Croom, the Ngawha plant improves Contact Energy’s capacity to manage transmission system constraints that can affect the region. “As the main local retailer, our agreement to purchase all the electricity generated locally at the Ngawha geothermal station improves our capacity to manage such issues in the best interests of our customers,” Croom said. Top Energy’s Ngawha Power Station currently generates around nine MW of electricity, producing about 35 percent of the total electricity used by consumers in the Northland region. “Our agreement with Contact Energy gives us the security of guaranteed earnings up to five years out,” said Top Energy CEO Roger de Bray. “When you consider this in the context of an uncertain environment for power generation and fluctuations in demand and pricing, this is a very significant contract for Top Energy and the Far North.” The contract also provides Top Energy with the commercial basis for an expansion of the generation capacity of the power station. The company has recently lodged an application under the Resource Management Act to have its existing Ngawha geothermal field consent term extended and to increase the generation capacity of the power station to approximately 25 MW. Contact Energy’s agreement with Top Energy includes the right to purchase additional output from an expanded Ngawha Power Station. When running at full capacity, the enlarged local plant could see around 70 percent of all electricity consumed in the region being supplied locally.
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