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Contact Energy has bought two 100MW gas turbine units to be installed in its disused Stratford power station site for firing up during times of peak electricity demand.
The General Electric LMS100 gas-fired peaking units can be fired up within 15 minutes.
The project will cost about $250 million and is expected to be generating power before the start of winter of 2010.
Contact chief executive David Baldwin said the peaking units would play an important role in securing electricity supply and increasing the use of electricity from renewable sources.
"The role of thermal generation is changing and, as recognised in the New Zealand Energy Strategy, the strategic use of efficient, fast-start peaking plants will be needed to support increasing volumes of weather-dependent renewables, such as wind generation.
"These peaking units will ensure efficient use of New Zealand's natural gas resources and underpin development of New Zealand's renewable resources."
Contact Energy plans to develop an underground gas storage facility in the depleted Ahuroa gas field in Taranaki to allow the company to store it during off-peak periods, such as during the summer, and use it when it is most needed, such as during winter peaks.
Contact Energy shares rose 11c to $8.59 yesterday.
