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Improving grid stability project ahead of schedule in Waikato

Powerlines on a cloudy sky
Photo: RNZ / Rebekah Parsons-King

Transpower is moving to the second stage of its voltage management project in Waikato ahead of schedule in an effort to further bolster grid stability.

A grid stability device, the second of the national grid operator's Waikato-Upper North Island project, will be installed at the Ōtāhuhu substation, a major juncture of high-voltage electricity lines and other infrastructure.

The device will cost $55 million.

General manager of grid development John Clarke said demand was increasing in the region as fossil-fuelled generation was being powered down has made voltage management challenging.

"Since we began work on stage one of this project in 2021, the speed of change in the electricity landscape in the North Island has increased with greater electrification of industry and transport, new datacentres and major new residential developments, combining to trigger this investment sooner than originally anticipated," he said.

"Without sufficient tools to ensure voltage management and power quality, issues may arise with grid stability that could affect electricity consumers across the country.

"We will prevent this by actioning stage two ahead of our original timeframe, ensuring New Zealand can continue its path towards greater reliance on renewable energy."

Clarke said the operator had been working on how to address future voltage management issues in Waikato and the upper North Island since 2016, aiming to get ahead of the problem.

He said the grid stability device had been deemed the most cost-effective approach to meet the region's need, but the company would continue to consider alternative measures, such as batteries or demand response.

In 2020 the Commerce Commission approved a two-stage major capital expenditure investment proposal at a total cost of $144m, giving Transpower an extended delivery timeframe and flexibility via an incentive scheme.

Clarke said the approach ensured the best value for the grid's customers.

"We are focused on avoiding unnecessary costs to our customers while ensuring we provide a transmission grid that delivers safe, reliable power supply to people up and down the country," he said.

The device will be made in partnership with Hitachi Energy and was expected to be in service by the end of 2025.

Transpower has been upgrading its network to ease tight spots and support New Zealand's transition to electrification and a lower-carbon economy by 2030.

The company last year completed its Clutha to Upper Waitaki Lines Project, nearly doubling the network's transmission capacity northwards.

Transpower was also investigating how to improve capacity in the central North Island, around Wairakei, and the interisland HVDC submarine cables.