Transpower lays down plans to end gridlock

A brake on rising power bills and better competition in the electricity market should flow from a $520 million upgrade to the crucial North Island-South Island power link, says Transpower.

The owner and operator of the national grid wants approval from the Electricity Commissioner to replace the fading 40-year-old technology with new equipment and install two new submarine cables under the Cook Strait.

Built in the 1960s, the high-voltage direct current (HVDC) line between the two islands forms the backbone of the national power grid, allowing cheap hydroelectricity to be used in North Island cities.

If approved, the upgraded line could be ready by 2010 and increase the capacity of the link from 1040 MW to 1400 MW.

Two circuits or "poles" make up the HVDC link.

One was built in 1991 using new technology; the other uses the original, 1965 equipment, which is the last example of its type in the world, according to Transpower.

That was now "progressively falling short of the reliability and availability standards" required of a 21st century power system, Transpower said in its submission to the Electricity Commissioner, Roy Hemmingway.

Power is usually sent from the South Island to the North Island.

It is converted from alternating current to direct current at Benmore in the Waitaki Valley, then transmitted over 535km to the shores of the Cook Strait, where undersea cables carry the power 40km to the North Island.

Up to 1040 MW of electricity can now be sent to the North Island, but only 600 MW can be sent the other way. In dry winters, when water is scarce in the South Island hydro storage lakes, power from North Island stations and dams is sent south.

This happened most recently in 2001 and 2003.

If the plan is approved, $90 million to $130 million will be spent on laying two new submarine cables under the Cook Strait, and the $300 million-plus will be used to install two new "valve halls" - one at Benmore, the other at Haywards in Wellington. The cables and pylons themselves will not need to be changed.

The proposal is part of the first grid upgrade plan that Transpower is submitting to the Electricity Commission.

This plan also includes its controversial scheme to string a 400 kV line through the Waikato.

Transpower says that getting cheap power to the cities involves more than just getting it across the Cook Strait: new investment is needed across the grid, so it can get electricity into the high-growth areas of Auckland and north.

It is Hemmingway's job to settle disputes about how the costs of such upgrades should be shared across the industry.

The HVDC link

Transpower wants to spend $520 million upgrading the power link between the North and South islands.

Known as the HVDC (high voltage direct current) line, it runs from Benmore on the Waitaki River to Haywards in Wellington.

By allowing more power to flow between the islands, there is more competition in the market.

The link provides cheap hydro power to the North Island, while also allowing power to flow south in dry years.

Transpower says the new technology will mean that the need for new, expensive power generation can be deferred.

The power lines themselves will not be changed, but two new undersea cables will be laid.