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Transpower

This analysis comes in the wake of an announcement from the New Zealand government, for instance, that there had been an allocation in the amount of $4.6 billion for the upgrading of the national power grid over the course of the next ten years, beginning in 2012, with the key purpose of the investments being the modernization of the grid and the setting up of infrastructure to ready the country for future increases in power consumption and demand. This fund is also earmarked to likewise improve reliability of power supply to consumers, both industrial and residential. On the other hand, the investment plan also takes a shot at the current state of generation and transmission in New Zealand, where generation facilities are centralized, and necessitate the kind of transmission infrastructure investments that could be limited and reduced by investing more in distributed generation moving forward. The idea is that transmission investments are not etched in stone as necessary, if generation is distributed, and if such facilities are located close to the demand. Where this becomes a reality, then there is a reduced need to build large generation facilities and the necessary transmission infrastructure needed to pipe the power to the consumers (Sustainable Energy Association, 2012). II. Transmission Upgrade Projects Are On-going and Massive The investment in additional grid infrastructure, in particular new transmission lines capabilities/capacities on top of the existing infrastructure, or as an addition to that, has been on-going, with the total capital outlay for those projects slated at $5 billion over the next ten years, as estimated by Transpower itself, and broken down into a number of key infrastructure projects, some on-going, and with varying completion dates. The key projects are said to be one, the upgrading of the transmission grid in the North Island, which is intended to erect a new link for transmitting power between Auckland and Whakamaru; two, upgrading of the transmission link between Northland and North Auckland, which entails putting up a 220 kV infrastructure link as well as two substations; three, the replacement of the pole used to link different islands in New Zealand via HVDC, specifically Pole 1; and four, the erection of a new transmission infrastructure between Whakamaru and Wairakei, that will be double-circuited (Transpower, 2012). The upgrading of the whole grid in the North Island is said to be among the largest of the current crop of on-going projects, with project completion slated in 2012, and ...Show more

Summary

This paper examines the decision of Transpower to make major investments in the national grid. The analysis and examination will be done in the context of the need for such an investment; the implications of the investment in terms of funding, as well as the cost of the investment;…
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