NZ Windfarms ready to finish project

A dispute with Windflow Technology over turbine technology standards has been resolved.

NZ Windfarms says it has reached agreements that will enable it to move ahead with completion of the Te Rere Hau windfarm near Palmerston North.

Resolution of a dispute with Windflow Technology led to a monitoring programme involving some components in early turbines at Te Rere Hau which were modified as part of Windflow's International Electrotechnical Commission certification process because they did not meet requirements for a 20-year life.

Consequently, NZ Windfarms would retain $966,200 plus GST, the estimated remediation cost, it said.

The money would be released to Windflow when remediation works were undertaken during the five-year warranty period or under some other conditions related to the life of the components. The settlement also dealt with some other issues.

Separately, a wind rights agreement with Aeolian Property had been renegotiated to allow preferential development of a proposed extension to the existing consented wind-farm area, known as the eastern extension, ahead of full development of Aeolian land, NZ Windfarms said.

Aeolian had agreed to remove a restriction under which NZ Windfarms was prohibited from installing turbines within a 10km radius of the Te Rere Hau site until the Aeolian land was fully developed with 97 turbines.

Aeolian had agreed to remove that restriction in exchange for an adjustment to the royalty rate applicable to the Aeolian land such that the royalty payable was equal to the royalty that would be expected if all 97 turbines had been installed on the Aeolian land.

Changes had also been made to the amount NZ Windfarms would pay for the Aeolian land under a put-option agreement which allowed Aeolian to require NZ Windfarms to buy the land, NZ Windfarms said.

Under the new arrangement, NZ Windfarms would have to pay $3.55 million, plus GST, if applicable, if Aeolian exercised the put option between June 30 and December 31.

If the put option was not exercised by the end of the year, the purchase price would be recalculated.

The various agreements were conditional upon NZ Windfarms carrying out a successful capital raising.

Late last year, NZ Windfarms said it had commissioned 65 turbines.

It wants to locate up to 56 turbines in the eastern extension, although its immediate plans were to put 32 turbines there.

It said previously the wind resource in the eastern extension was far better than on the remaining consented sites on the existing farm.

- NZPA