Lake Onslow

MERIDIAN Energy chairman Mark Verbiest claims that the proposed pumped hydro scheme at Lake Onslow will be uneconomic, and will discourage generators from investing in new power plants (ODT, 2.10.20).

It will in fact put a ceiling on wholesale prices by stopping the power shortages that currently lead to price spikes.

The system currently runs a virtual auction every half hour, whereby the last bidder needed to cover demand sets the price paid to all the other bidders — even hydro, whose capital costs have been paid off decades ago.

The shortages, especially in winter, are what lead to use of expensive and highcarbon gas and coal.

High prices might let Meridian build more wind turbines, but there will still be long periods with little wind, which will cause the other gentailers to use peaking gas plants, and Meridian will still buy power off those when it has to.

Norway, like the South Island, gets about 99% of its power from hydro, and both have emissions from power production among the lowest in the world. The North Island, with four times as many people as the South, has CO2 emissions per kw/hr 410 times as high, depending on the season.

The Government has allocated half a billion dollars to upgrading 1500 state houses. To do the 40,000 houses still needing work would presumably cost upwards of $12 billion, and they’d still need power afterwards.

At $4 billion, the Lake Onslow scheme would radically cut our emissions, cap power prices, and act as an enabler for any subsequent lowemission power projects.

We’ll need those. Norway uses hydro power for industry, home heating, and charging its large electric car fleet, but it has twice as much hydro storage, and six times as much generating capacity as New Zealand — for the same population.

John O’Neill

Roslyn