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The Electricity Commission has approved Transpower's 190km transmission line between Waikato and Auckland.
The above ground 220 kilovolt line will have the potential to be upgraded to 400kv in the future.
The new line will mean Auckland is not as dependent on the Otahuhu line, a risk that was highlighted in June last year when the city had a huge power outage.
The Herald reported this morning that there is speculation the Government will fast-track the development to ensure it does not get stalled by the Resource Management Act process.
But there was no word today on whether Environment Minister David Benson-Pope will "call-in" the project.
The proposed line, which has now been extended from Otahuhu to Pakuranga and includes a substation upgrade to improve security, is proposed to be commissioned in 2011.
Last year the Commission declined a lines upgrade by Transpower, saying it did not meet their grid investment test.
The rejection led to a rift between Transpower and the then-Commissioner Roy Hemmingway. Mr Hemmingway left in November last year saying he had been dumped for refusing to do what ministers would like. That was denied by the Government.
Commission deputy chair Peter Harris said while the last bid by Transpower was unanimously declined, the latest application has been approved by a majority.
"The new proposal was substantially better in terms of providing reliable and cost-effective transmission to the upper North Island," he said.
Mr Harris said it provides a diversity of supply which means consumers will be better off in the long run.
Public submissions have been received after Transpower lodged it's submission in January.
Transpower's costs, the impact of electro-magnetic fields, environmental and community impacts and alternatives were all considered, Mr Harris said.
He said some of the concerns raised by residents including route changes, tower heights and easement widths could be re-visited in the Resource Management Act process.
Commissioner Graham Pinnell, who disagrees with Transpower's proposal, said the 220kv option would save money.
Mr Pinnell said he disagreed with electricity demand growth projections used by the commission to assess Transpower's proposal.
Anti-pylon group New Era Energy spokesman is vowing to "battle on" following the Commission's decision.
"This is a disappointing decision, but not the end of the battle," New Era Energy spokesman Bob McQueen said.
He said upgrading the one line is not securing supply.
"The real solution to security of supply of electricity to Auckland is to quickly upgrade existing lines and then fast-track current generation proposals by Contact, Genesis and others to build new generation capacity in or north of Auckland," Mr McQueen said.
- additional reporting: NZPA
