Wind farm plan eyes ocean power
More than $6 billion of investment is blowing Waikato’s way as an international consortium sets out plans for up to almost 100 electricitygenerating offshore wind turbines on the region’s wild west coast.
The consortium hopes to build the huge offshore wind farm about 22 kilometres out to sea from Raglan.
The companies behind the proposal – BlueFloat Energy, Energy Estate and Elemental Group – said the multibillion-dollar wind farm could generate enough electricity to power 700,000 homes. The project is currently at the ‘‘feasibility stage’’ with construction hoped to commence some time before 2030.
The wind farm would take about three years to build, possibly creating more than 1000 jobs in the process, if it proceeds. The BlueFloat consortium hoped regional investors might contribute to the development costs of its Waikato project, although the consortium said it had deep funding pockets.
Energy Minister Megan Woods this year ordered work to start on a regulatory framework for the development of offshore wind farms but that is not expected to be in place until 2024.
In the interim, the BlueFloat consortium and a separate joint venture comprised of Danish infrastructure fund Copenhagen Infrastructure Partners (CIP) and the NZ Super Fund have begun scoping out opportunities.
CIP and the NZ Super Fund are investigating the construction of a massive $5b wind farm about 23km to 30km out to sea in the South Taranaki Bight.
They estimate that would be designed to generate enough power to meet more than 11% of New Zealand’s current electricity demand.
The CIP joint venture has got as far as applying for permission from the Environmental Protection Authority to install a floating platform that will measure wind speeds at its proposed site, and also does not expect construction of its wind farm to start until about 2030.
Spain’s BlueFloat Energy, Australia’s Energy Estate and New Zealand’s New Plymouth-headquartered Elemental Group also aim to build a wind farm in a similar location offshore from South Taranaki, at an estimated cost of about $4b.
Given the size of the turbines that would be used in the developments, both consortiums have said they would be visible from the coast on a clear day.
Phase one of the Waikato project would create about 250 megawatts of generating capacity using up to 20 turbines fixed directly to the sea floor, and would create about 300 jobs.
A second phase to create 800-1150MW, possibly using as many as 77 ‘‘floating’’ turbines tethered to the sea floor, would be to the west or north of the phase one development.
An additional 800 or more jobs could be created. The life of such offshore wind farms is about 35 to 40 years, after which they would be decommissioned or refurbished.
Consortium officials said costs could be more than $6b overall.
Phase one could possibly cost $1.3b and phase 2 about $5b. Final costs will depend on various factors, such as wind farm technology developments, they said.
On funding, partnerships director Justine Gilliland indicated the consortium had deep pockets with, for example, BlueFloat being backed by a United States-based private equity firm.
‘‘The consortium does have a level of investment at its disposal . . . so there is considerable depth within that investment pool.’’
But it could use other options such as raising funds through the likes of share floats and linking with local partners.
‘‘I think particularly one thing that we are open to is investment from the region,’’ Gilliland said, ‘‘whether that is from iwi or other potential local partners.’’
To anyone doubting the consortium’s financial capacity to achieve its end goals, she said the project was not unusual for the partners in the consortium.
BlueFloat, for example, had 22 gigawatts-worth of projects in the pipeline internationally, excluding Aotearoa.
Aotearoa also had a track record of completing major energy initiatives. ‘‘We have built big projects in New Zealand, so it is not like we can’t do it.’’
She pointed to Waikato’s good energy distribution network and potential for local industrial users to take consortium power as advantages of investing in the region.
Energy Estate co-founder Simon Currie said the consortium was clear the project could be done in a way that protected sea life and the wider marine environment.
Gilliland said developments would be outside marine mammal sanctuary areas and well out to sea.
Currie said the wind farms were expected to become a ‘‘commercial fishing no-go zone’’, requiring negotiations with commercial and recreational fishers, and possible compensation. Liaison would also be required with coastal communities and other marine users. There were already ongoing discussions with iwi and hapū .
‘‘Co-design, co-governance, coownership, compensation – all these things have to be on the table.
‘‘We can’t be saying: oh that’s not my problem, that is the Government’s.
‘‘We will never build an industry if we take that approach.’’
On what was the end game for the consortium with its four projects, Gilliland said ‘‘we are building a whole new industry for New Zealand’’ and that she wanted to be able to look back and say it was done in the right way.
In a statement welcoming the announcement, Fiona Carrick – chief executive of Waikato economic development agency Te Waka – said energy was a key growth industry for Waikato.
‘‘As New Zealand, and the world, transition from fossil fuels, the Waikato region’s potential in geothermal, hydro-electric and wind power shapes up as a significant area of opportunity.’’