Transpower warning: Auckland will suffer

A Transpower worker keeps an eye on the screens that track electricity supply throughout New Zealand. Picture / Amos Chapple

Auckland's economic development will suffer if the controversial 400kV line linking the Waikato to Auckland is rejected, says Transpower.

It made the comment yesterday in its submission on the Electricity Commission's April decision to delay the 430-pylon line, possibly until 2017.

Transpower chief executive Ralph Craven said: "Delaying until 2017 will restrict the economic growth of Auckland, [while] relying on a series of incremental upgrades between now and 2017 prolongs and adds risk to an already critical situation. Planning to operate the system at the extremes of its limits is not prudent; and the costs to all New Zealanders of investing too late are far higher than the cost of investing too early."

In rejecting the Transpower proposal in April, the commission said an investment of $140 million in the existing network - and perhaps the construction of new power stations near Auckland - would delay the need for the planned 400kV line and save the country as much as $250 million.

Transpower, on the verge of submitting another 220kV proposal that could be later upgraded to the 400kV line, said the plan already submitted was the best option.

The 220 kV technology was yesterday's solution to tomorrow's problem, would provide less capacity and require more lines to be built sooner.

It also attacked the so-called "grid investment test", against which the regulator assessed the merits of its proposals. The test had understated the risks of delaying a new line, understated the benefits of a robust transmission grid, overstated the cost of Transpower's proposal, defined grid reliability standards too narrowly, and been applied without adequate industry and Transpower engagement.

"In response to the way the grid investment test has been applied, Transpower has elected to suspend its original proposal and to work on a revised proposal," Craven said.

In addition to the staged proposal, Transpower is also working on a separate project to reduce Auckland's dependence on the substation equipment at Otahuhu, which received blame after the recent power failure.

The commission has said the submissions it receives on the suspended draft decision will be important for their consideration of the new proposal.