A consumer-owned power company in Central Hawke's Bay has defended spending $200,000 on a report looking into the feasibility of a dam in the region.
The payment has been criticised by a power consumer who believes it falls outside the company's scope and is a misuse of funds.
Centralines is in charge of running the power network in Central Hawke's Bay and is owned by the CHB Consumer Power Trust.
Last year Centralines paid $200,000 for a feasibility assessment carried out by private company Tukituki Water Security Limited, looking into improving water security in Central Hawke's Bay.
The report found there was a need for catchment-scale water storage on the Makaroro River, the same river as the failed Ruataniwha dam.
Other groups and businesses also contributed money toward the report but the majority of the cost was shouldered by Centralines.
The CHB Consumer Power Trust has since revealed it did not directly approve the $200,000 payment for the report.
However, CHB Consumer Power Trust chairman Alistair Setter said he did not think Centralines acted inappropriately or outside its scope in funding the report, as it did not require direct approval from the trust to pursue business growth opportunities.
"We write a letter of expectation to [Centralines] each year.
"One of the key points we put in there is we expect them to grow the business and look into growth opportunities," Setter said.
"They would have seen this and thought if water [storage] doesn't go ahead in Central Hawke's Bay the economic ramifications would be terrible and it would negatively impact Centralines, whereas if water security was good it would be very positive for Centralines."
In 2018, a proposal to build the $330 million Ruataniwha dam was blocked by the Supreme Court despite almost $20 million spent by Hawke's Bay Regional Council on consents and planning.
Various groups have continued to fight for the dam.
Setter said this was the first time Centralines had put money into a project supporting a dam, and others also contributed money toward the report.
"The [assessment] is really the last push at seeing whether anything can be done with water storage in relation to those consents [for a dam]," he said.
"I would be really uncomfortable if Centralines was the only one pushing it along.
"Centralines by no means is a dam builder.
"It is just not the space they should be getting into.
"But as a community-good project, keeping options alive for water sustainability in CHB, I think it is a good thing."
He said if a dam went ahead it could lead to good business growth for Centralines, with extra power needed to service infrastructure.
Tukituki Water Security Project chairman Mike Petersen said when they went looking for sponsors for the report, they intentionally avoided going to irrigation companies so that it would not be seen as just being supported by those in favour of a dam, and instead went to local businesses and groups.
He said he did not have any problem with it being jointly-funded by Centralines.
Centralines chairman Ian Walker also defended the $200,000 payment.
He said new businesses, homes and infrastructure that could result from better water security would lead to more electricity distribution opportunities for Centralines.
"Centralines is always looking to invest to develop the business a little bit more," he said.
"We can see that water availability in the CHB area is going to be critical to make further growth and progress."
He said it was unlikely any more money would be spent on the project by Centralines.
Central Hawke's Bay resident and power consumer Trevor Le-Lievre, who has spoken out against a potential dam in the past, said it was a misuse of funds by Centralines.
"This is way outside Centralines' scope. They are essentially contracted by the trust to manage the local power distribution network for the benefit of local power consumers," he said.
"Centralines' primary responsibility is to maintain and improve the network and then any profits should be returned to consumers by way of rebates.
"What on earth are they doing getting involved in water storage?"