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New Wellington wind farm to go ahead

11:30 AEST Fri Jun 15 2012
Meridian Energy is to go ahead with a second wind farm in Wellington
Meridian Energy is to go ahead with a second wind farm in Wellington (Getty)

Meridian Energy has given the green light to building a new $169 million wind farm in Wellington's Ohariu Valley, following the success of its West Wind development just to the south.

The 26-turbine Mill Creek wind farm is expected to generate electricity from mid-2014 at the bottom end of the cost range for wind farms, making it competitive with new geothermal electricity generation at around $80 per Megawatt hour.

The strong New Zealand dollar, weakening global steel prices and competitive pricing from wind plant manufacturing combined to support the case for the relatively small wind farm, at a time when bigger projects are being shunned because of slow demand growth for electricity in the sluggish local economy.

Mill Creek is estimated to cost $3.3 million annually to operate and to generate an average 235 Gigawatt hours of electricity annually, benefiting from the consistency and strength of winds generated by the funnelling effect of Cook Strait.

"Mill Creek is a very strong commercial proposition," said Meridian chief executive Mark Binns.

"We believe the combination of the wind farm's relatively small size, location and compelling economics sets a benchmark for the industry."

Like the 142.6MW West Wind farm, Mill Creek was expected to be "one of the most productive wind farms in the world," he said.

Mill Creek wind farm will be located on privately owned farms in Ohariu Valley.

Meridian gained resource consents in 2010, and won appeals in the Environment Court against the project last August.