Kyoto deal generates growth

By CHRIS DANIELS

The first windfall of the Kyoto Protocol on climate change has been announced by the Government, with the building of two wind farms about to get the go-ahead.

Once finished, the two projects, one from Trustpower and the other from the state-owned Meridian, could mean a tripling of New Zealand's total wind-generation capacity.

Energy Minister Pete Hodgson said the Government would help by giving the companies credits for the clean energy their wind farms would produce.

Meridian plans to build a new wind farm, while Trustpower wants to more than double the size of its existing farm on the Tararua ranges near Palmerston North, which is already the biggest in New Zealand.

Meridian spokesman Alan Seay said that although the site for its wind farm had not yet been decided, it would likely be able to generate between 40MW and 80MW, meaning the installation of an equivalent number of 1MW wind turbines.

New Zealand's biggest thermal power station, at Huntly, has an output of 1000MW , while the Clyde Dam can generate 432MW.

Seay said Meridian was investigating a range of possibilities for the location of its wind farm, and expected to lodge applications for resource consents before the end of this year.

Although Meridian is being coy about the potential sites, most energy analysts point to the lower North Island as being the most attractive part of New Zealand for exploiting wind power. Meridian's state-owned rival, Genesis, operates a 4.2MW wind farm near the southern Wairarapa town of Martinborough, which it is also planning to expand.

The provision of carbon credits, which can be traded on world markets, is designed to help tip the balance in favour of wind-powered generation that is often more expensive than electricity from gas-fired power stations.

High maintenance costs, the usual need for a remote site and the fact that it produces electricity only when the wind blows are some of the factors that make wind power unattractive.

Construction of Trustpower's new Tararua extension, depending on the availability of turbines, could begin next year, with the Meridian development not likely until 2005.

Trustpower, which already has resource consents for its plan, is hoping to add another 55 turbines to its present farm of 48.

The Government plans to use some of New Zealand's carbon credits, earned from so-called "carbon sinks" such as plantation forests, to recognise the climate change benefits of new, renewable-energy sources.

"This is a way for the Government to support the development of renewable energy by making use of the opportunities created by the Kyoto Protocol," said Hodgson.

A mechanism for companies to apply for credits was being developed, he said, but Meridian and Trustpower had approached the Government with their proposals.