Geothermal power station gets go-ahead

A privately owned geothermal power station providing enough electricity to match Auckland's annual growth demand has been approved in Taupo.

Resource consent for Geotherm Group to build the $280 million station was granted last month after four years of waiting.

When complete, the station's daily output of 60 megawatts will equal the annual electricity demand growth rate generated in Auckland, its owners say.

The station will be built 4km west of Taupo on Poihipi Rd, generating power using 70,000 tonnes of geothermal fluid per day sourced from the Wairakei-Tauhara geothermal field, also used by Contact Energy.

Consent for the new station took so long because Environment Waikato has a single tapper policy, meaning only one operation can take from the field at a time and Contact Energy had a re-consent application before the council to continue its existing operation.

The decision by three independent commissioners appointed by Environment Waikato challenges the policy, although conditions placed on Geotherm minimise any impacts.

Alistair McLachlan, chairman of directors for Geotherm Group, said all the fluid taken from the field would be injected back, causing no subsidence, an issue that has plagued Taupo in recent times.

It is the first station in the world to adopt this system.

The re-injection of fluid is a condition of the consent and Geotherm will also be required to tracer-test the re-injected fluid to check any impact on Contact Energy's existing operation.

Mr McLachlan said Geotherm was happy with the conditions and building would go ahead provided there were no appeals to the decision by January 28.

"This operation will not have any impact on subsidence in Taupo. Subsidence is not just a political argument, it affects people's homes."

Earthworks for the station will start next month with the moving of half a million cubic metres of soil to build a plateau.

It is hoped 16 wells to draw out the fluid will be drilled 1km deep by August.

Eight wells 1.5km in depth will be drilled to replace the fluid.

Mr McLachlan said plans were also under way for a 100-seat theatre and a covered tunnel sitting two storeys over the station.

"We're hoping it will become part of the tourism market here as well and educate people about geothermal energy."

The company was in talks with four national electricity retailers bidding for the power generated.

Mr McLachlan said the station would take about two years to build, employing 200 people.

Once operational, it would need 12 staff.

It is the second station Mr McLachlan has built. His company was involved in a partnership with Mercury Vector to build a station 6km west of Taupo in 1986.

But the partnership went sour when Mercury became a lines company and the station was sold to Contact Energy.

Mr McLachlan's company is suing Vector in the High Court for damages.