Solar panels installed in a field with room for livestock to graze beneath. FRV Australia is developing a solar farm with Genesis Energy near Lauriston on the Canterbury Plains, with the site expected to generate 52MW of power by 2024.
Genesis Energy has set its sights on becoming New Zealand’s biggest solar power provider with three new projects - worth $600 million - on the drawing board.
Genesis and its joint venture partner, FRV Australia, have confirmed new sites for solar farms the Manawatu, Waikato and Hawke’s Bay - with potential for 400MW of renewable electricity capacity.
This follows securing an advanced stage site at Lauriston, in Canterbury, for a 52MW solar farm in February and the combined generation puts the company on track for the target it set itself in 2021 of up to 500MW of solar within five years.
The timing of the builds is subject to regulatory processes, and final investment decision, however the first of the new sites announced today is expected to be generating electricity by 2026.
Genesis chief operations officer Rebecca Larking said there’s a real buzz about solar these days.
National grid operator Transpower says solar projects account for 66 inquiries, or three-quarters of the total inquiries, currently in the pipeline.
On paper at least, the current total solar generation - with battery projects - in the works would amount to 10,006 megawatts (MW).
Transpower is quick to point out, though, that not all the projects that apply to connect up to the grid become a reality.
As it stands, there is currently around 270MW of installed solar generation in New Zealand.
This equates to about the same capacity of a coal or gas-fired Rankine unit at Genesis Energy’s Huntly plant, according to the Electricity Authority.
Larking says the company is in a unique position due to its broad mix of assets.
As owner-operator of the coal and gas-powered Huntly Power Station, Genesis is one of country’s biggest carbon dioxide emitters, but also has significant hydro and wind power generating assets.
And on the renewables front, Genesis wants to become New Zealand’s biggest solar power provider.
As it stands, Genesis has three hydro stations in the Tongariro Power Scheme and another three in the Waikaremoana Power Scheme.
Further south, it has Tekapo A and B in the Mackenzie District, and the Hau Nui wind farm in the Wairarapa.
Then there is its 46 per cent stake in the Kupe oil and gas field off the Taranaki coast.
Larking says there is a lot of interest in developing solar in New Zealand.
“What it will come down to is the number of projects that actually get delivered but yes, there is a great deal of interest around at the moment,” she said in an interview.
The company is on track to make a final investment decision by the end of the year on its 54MW Lauriston project.
Construction will start soon after, and first generation of electricity from Lauriston is expected late in 2024.
The three new sites will generate enough electricity to power about 85,000 homes per year - enough for a city the size of Wellington, which it says would make Genesis the largest solar generator in the country by some margin.
The solar farms will remove about 500,000 tonnes of CO2 emissions from fossil fuel generation annually, the company says.
Much of the land required for the new projects will be shared with agricultural uses, such as sheep grazing.
Larking said solar provided a strong alternative source of renewable generation to help offset the country’s heavy reliance on hydro and wind power generation.
Solar has the added benefit that the time to build and start delivering electricity is a lot quicker than any other type of generation.
She says this aspect would help jump-start electrifying and decarbonising New Zealand businesses and households at scale ensuring the country is on track to be net zero by 2050.
Nobody puts solar up as a single solution for New Zealand’s carbon emission challenges.
Rather, Larking sees solar as being another piece of the renewables puzzle.
“Building solar farms is part of that,” she says, adding Genesis is also looking for power purchase agreements (PPA) with other players to invest and build more renewable generation.
Renewables have made up 44 per cent of Genesis’s total generation on average over the past five years.
The 2023 year was an outlier year for everyone with the high hydro levels throughout the year which saw renewable generation hit 65 per cent.
Genesis aims to get its proportion of renewable generation is targeted to move to 68 per cent by 2025 and 81 per cent by 2030.
“Solar will be a part of that, as will other options.”
Craig Brown, the company’s general manager of commercial development, said there can be a mismatch between projects that are investigated and those that are developed, which is why it is important to have quality projects.
Brown says there is a lot of talk around solar in New Zealand, and world events have seen to it that it has come into sharper focus internationally as well.
In addition, solar is becoming cheaper to build.
“There is a need for more generation to meet growing demand and to create a more renewable electricity market in terms of displacing thermal, and that combined with the cost to build solar is what is driving the interest - from us and for others in the market.”
FRV Australia is one of the largest solar developers, asset owners and renewable energy platforms across the Tasman, with total project investment of over A$2 billion (NZ$2.16b).
While in Europe, Brown visited FRV’s headquarters in Spain, and attended the Intersolar Europe trade show in Munich.
He said gas shortages arising from the war in Ukraine and America’s Inflation Reduction Act - which has boosted renewables construction - has increased interest in solar solutions.
As investment in New Zealand renewables - wind, geothermal, solar and perhaps offshore wind - picks up, it raises the problem of intermittency - and the need to keep the lights on when the weather is not playing the game.
“We either have to have a great deal more intermittent generation for security or you need to offset with other baseload generation activities,” Larking says.
“That’s why we are exploring the options - like biomass (for Huntly) to increase renewable generation.”
Genesis is a significant provider of baseload, or continuous power, from its gas turbine at Huntly - Unit 5 - which is currently out of action for repairs - and Larking sees a future for gas in the short term.
“In the transition, it feels like gas will really matter while more of those intermittent sources of generation are coming on.
“So I think the key for the market is diversity, which will bring flexibility to the market,”
Brown noted that while there was rising interest in solar, there was also a heavy reliance on a few countries for materials and components.
“These trends can impact on the ability for New Zealand projects to secure competitive equipment pricing and adequate lead times for delivery given the country’s requirements are comparatively small in scale and our distance from the rest of the world,” Brown said.
“This highlights the importance of international relationships and access to global supply chains and purchasing power,” he said.
Genesis Solar:
Jamie Gray is an Auckland-based journalist, covering the financial markets and the primary sector. He joined the Herald in 2011.