Meridian Energy’s plans for a 260MW hydro project on the lower reaches of the Waitaki River have been suspended due to the current state of the electricity market in New Zealand, the company has announced.
In a statement, the company said it is suspending land access negotiations for the North Bank Hydro Project. Chief Executive Mark Binns said that while the project is probably New Zealand’s best hydro opportunity, the current flat demand for electricity means fewer new generation projects will be required in the short to medium term. The company is planning to monitor the situation and pick up development at a later stage if needed.
Meridian has been in negotiation with landowners for land use consents since gaining water use consents for the project from the Environment Court in November 2010, following an appeal of the original Environment Canterbury consent.
Binns said Meridian had always made it clear that North Bank was a long-term project and significant progress has been made in negotiations with most of the landowners along the proposed project route.
“We have got it to a stage where when we find new generation is required we can pick things up at a later time," said Binns. "Like other generators we recognise that the demand outlook for the next five years is probably flat to slightly declining. Our current focus is on making sure we have two to three projects ready to go so that if we need new generation we can progress these options.
As a result, further work on land access is being suspended. We will continually review this in line with marketing conditions."
Meridian will continue to monitor the situation looking at New Zealand’s generation and supply opportunities, and Meridian’s market position.