$25 million funding for Eastland Generation’s new 50MW geothermal plant

Eastland Generation’s 25MW Te Ahi O Maui geothermal plant. Owner Eastland Group is recycling capital into its significant generation pipeline. File picture

The Government’s  green investment bank will lend $25 million to Gisborne-based Eastland Generation to help fund its Bay of Plenty geothermal projects.

New Zealand Green Investment Finance (NZGIF) will supply up to $25m to fund the construction of connection assets for the new 50MW TOPP2 geothermal plant.

Additionally, it will enable upgrades to the existing connection of the 25MW Te Ahi O Maui geothermal plant, also in Kawerau.

“The loan represents an attractive opportunity to support a leading infrastructure operator and regional decarbonisation,” NZGIF chief investment officer Jason Patrick said.

“NZGIF’s tailor-made funding will support Eastland Generation and subsequently the energy resilience of the Eastern Bay of Plenty region, benefiting industry and farming in the region.”

Crown-owned NZGIF is a green investment bank which was established in 2019 to facilitate and accelerate investment that can help to reduce greenhouse gas emissions in New Zealand.

Eastland Generation is owned by Eastland Group, a specialist infrastructure company headquartered in Tairāwhiti that also operates Eastland Port and Gisborne Airport.

Having recently sold its electricity distribution business, Eastland Group is recycling capital into its significant generation pipeline.

“Partnering with NZGIF was a natural choice as they identified a specific opportunity and share our commitment to sustainable, enduring investments in renewable infrastructure, combined with a commercial approach to the transaction,” Eastland Generation chief executive Alice Pettigrew said.

Eastland Generation has an agreement with Ormat Technologies, a leading global provider of renewable energy solutions, to build and operate the power plant, with an option for Eastland Generation to purchase it.

A capital raise process, to find a buyer for a 50 percent stake in Eastland Generation, is already under way.

A key driver of that capital raise is to use the funds, in part, for the development of TOPP2,

Eastland Generation owns and operates three geothermal power plants on the Kawerau geothermal field in the Bay of Plenty. This includes Te Ahi o Maui (25MW), Geothermal Developments Ltd (9MW) and TOPP1 (24MW).

This is in addition to a hydropower station (5MW) near Wairoa and a soon-to-be operational utility-scale solar farm (5MW) on land adjacent to Gisborne Airport.