Aotearoa-New Zealand’s renewable electricity broke a long held record in the last quarter of 2022, climbing to nearly 95 per cent of all power generated.
The new record of 94.7 per cent renewable electricity between October and December was just above the previous record of 94.6 per cent in the March quarter of 1980.
It is a hopeful sign that the country can reach 100 per cent renewable electricity generation in a year with ‘normal’ hydro levels. Even so, consistently meeting that target is an ambitious goal. It requires a mix of renewable and smart network technologies, as well as the investment from the industry and, perhaps, the Government.
The weather was a big contributor to the renewable record last spring.
NIWA says rainfall was above normal, or well above normal, in the Waikato hydro scheme catchment throughout October, November and December. Mercury – which operates the hydro generation along the river - stated the period from July to December 2022 was the “wettest first half ever”. Waikato's generation for the period was up 38 per cent on the year before.
While weather was the biggest factor in 2022, there is a major pipeline of large-scale wind, geothermal, and solar farm projects that have launched since the Government announced the renewable targets.
Utility-scale solar is well positioned to play a key role in the renewable electricity push. At least 1900 MW is currently being planned, consented or constructed.
So, what role will solar play, and what might the generation mix of Aotearoa to look like by 2030?
Simulation of Christchurch Airport’s Kōwhai Park solar array, expected to begin in 2024: Image source: Christchurch Airport
New Zealand’s solar capacity grew from 5 MW when the Electricity Authority began collecting data in August 2013, to 260 MW at the end of January 2023. Much of that total – 195 MW - is from small, grid-connected residential rooftop installations.
The energy industry's slow adoption has been due to two main drawbacks: panels only produce electricity during the day, and their peak out put is in summer. Nationally, our highest generation needs are generally between 6 am and 9 am in the morning and 4.30 pm and 9 pm at night. Total and peak daily demand rises during colder, darker winter months.
But as technology improves, there is ample evidence that utility-scale batteries can help smooth the discrepancy between production and demand. Meridian Energy’s 100 MW Ruakākā battery at Marsden Point will provide additional grid backup and improve the economics of the 130 MW solar array the firm plans to build alongside it.
Solar and batteries can also be harnessed to support the grid and networks during high demand periods. This is already used by residential panel and battery lease firm solarZero. The company has effectively created a large distributed network of home-system units, that it is offering into Transpower’s demand response programme.
In 2021, solarZero had up to 10 MW of power available from batteries in households around the country. By November last year, its Virtual Power Plant was providing up to 40 MW as reserve power sources for the national grid and local distribution networks.
Regulators and companies are working to provide similar network support options to other solar systems, home batteries, and electric vehicle owners.
Regional, Commercial Benefits
The localised benefits of solar are increasingly being understood. Some distribution companies, such as Christchurch-based Orion, are working to encourage on-farm solar to help reduce irrigation loads and network investment costs on their low-voltage lines.
Genesis Energy and solar developer FRV Australia bought the consented 52 MW Lauriston solar farm project from Hive Energy in February. Located in Ashburton-based EA Networks’ distribution area, it will make a significant contribution to its electricity needs during irrigation season. The site is expected to provide up to 13 per cent of the network’s annual energy requirements.
Rooftop solar can also be useful for businesses as the output usually matches a working day. Meridian has worked with mall-owner Kiwi Property to install panels on its shopping centres in Auckland, Hamilton, Palmerston North and Christchurch. Genesis also supports solar on schools as part of its School-gen programme.
Solar is also opening new market-based solutions for companies with widely distributed power demand. Retirement village company Ryman Healthcare has announced plans to build a $35 million solar farm in Northland to offset is electricity use nationwide. It has partnered with Solar Bay, which is contracted to buy the electricity from Ryman, and Mercury, which will supply any additional power when production does not meet the company’s needs.
Ryman chief executive Cheyne Chalmers said the project avoids the need to retrofit panels in villages throughout the country and also takes some pressure off the national grid at a high demand location north of Auckland.
Wider Renewable Push
Simulation of part of Meridian Energy’s Harapaki Wind Farm development in Hawke’s Bay: Image source Meridian Energy
Alongside the upswing in solar development, wind - currently about 6 per cent of total generation - has an important role in reaching the 100 per cent renewable target.
Resource consents remain a hurdle for new wind developments. They are big objects in the landscape and many people object to the ‘hum’ from blades rotating. There are also issues around the impact of wind farms on bats and bird populations. Ongoing research and improvements to site design and lighting are reducing these problems, alongside technologies such as radar detection and cameras to detect migratory birds.
Like solar, wind is an intermittent electricity source – if the wind isn’t blowing, the turbines aren’t generating. However, the country’s position in the Roaring Forties – a predominant westerly wind along the 40th latitude – provides an enviable renewable resource. This means some part of the country usually has some wind.
Several new wind farms are being built, including Meridian’s 176 MW Harapaki project in Hawke’s Bay, scheduled to be completed in mid-2024.
Last year Mercury completed the ‘North’ stage of its 222 MW Turitea wind farm near Palmerston North. Once the ‘South’ stage is complete, it will be the country’s largest wind farm. The firm is also building the 43 MW first stage of Kaiwera Downs near Gore.
Once these projects are commissioned, the firm has a trio of options – 230 MW at Puketoi, between Eketāhuna and Dannevirke; another 197 MW at Kaiwera Downs, and a 160 MW addition to its Mahinerangi wind farm, west of Dunedin.
Positioned on the ‘Ring of Fire’, Aotearoa has a fantastic geothermal energy resource. Geothermal contributes about 20 per cent of the country’s electricity, with more capacity in development.
Geothermal generation has the advantage of providing a 24/7 baseload for the grid, providing a consistent baseload, helping to offset fluctuations in output from more intermittent sources.
It is considered a ‘low carbon’ electricity source. Geothermal fluid has varying carbon content, which escapes. Two of the largest geothermal operators – Mercury and Contact Energy – are working to remove carbon from geothermal steam and reinject it in a stable state underground.
Contact – which is also investing in Christchurch Airport’s 150 MW Kōwhai Park solar farm – has a significant geothermal project pipeline underway. Its new 174 MW Tauhara geothermal plant near Taupō will be completed later this year, and a third unit is being constructed at its Te Huka power station adding a further 51.4 MW, from late 2024.
Location of the 5TWh Lake Onslow pumped hydro project under consideration: Image source MBIE
Hydro generation has been at the centre of the country’s electricity since the 1880s. In 1888, Reefton Electric Light and Power Company built a hydro electric station to create the first municipal electricity supply in the Southern Hemisphere. Now hydro provides more than half of the power used in Aotearoa, with most stations built between 1940 and 1992.
Today's headlines are about a potential pumped-hydro scheme - The NZ Battery Project. The Government is considering pumping 5 terrawatt hours’ worth of water into Otago’s Lake Onslow using energy during times of abundance to store water. The water would be released for generation in the event of a ‘dry year’ when there is a risk that the major hydro dams cannot continue operation.
Pumped hydro is expensive, but the thinking is that the cost of continuing to rely on stored coal or gas for dry year events or face electricity shortages would be higher. This is already a risk, but could become more so with demand growth and as thermal plants are phased out.
Whether Onslow should go ahead is still being investigated, with the cost projected to be in excess of $15 billion.
Smaller pumped hydro sites are also being considered. The upper Moawhango River in the central North Island would be much closer to the country’s large population centres, but may not provide enough backup in a severe drought.
Pumped hydro is a tantalising possibility, but a sound economic case is needed to justify the high capital cost.
Attaining 100 per cent renewable electricity by 2030 and a net-zero carbon economy by 2050 are tough but interesting, challenges. More efficient homes, businesses and industrial processes remain an essential but underutilised part of our renewable energy solution.
Other potential new generation sources are likely to contribute – off-shore wind is predicted to play a role in the long-term generation mix of Aotearoa and a fledgling marine energy sector may become an opportunity in coming decades. Fuel cells and hydrogen may be widely adopted, especially for heavy transport and industry.
Reaching 94.7 per cent renewable electricity over one quarter is encouraging. Also of note, the total energy supply of the country, including non-electrical heat and transport, reached 40.8 per cent - a 30-year high - in 2021.
Importantly, the targets provide common goals for individuals, companies, and communities.
Diverse renewable sources, alongside smart technologies to help us use energy more efficiently, are the best path forward.
Aotearoa has a long way to go, but these early results indicate the journey is off to a good start.