Waikato and Upper North Island Voltage Management Investigation

Last updated: 21 Mar 2023

The need for investment

Since 2012, over 1000 MW of generation capacity has been decommissioned in the Waikato and Upper North Island regions. This generation reduction coupled with the actual and expected demand growth in the Waikato and Upper North Island raises significant voltage stability risks. The potential retirement of the two remaining Huntly Rankine units further increases this risk.

The critical risks are transient under- and over-voltage events that could cause voltage collapse if not managed. Efficient voltage management is essential to delivering electricity reliably.

Our proposed solutions

There are many ways of supporting voltage such as by using capacitors, synchronous condensers, STATCOMs and SVCs, but potentially also demand response and generation solutions. Moreover, the issue is complex and a portfolio of different assets – at various locations and commissioned at different times – rather than a single asset solution is needed.

After three years of in-depth analysis, we are proposing a mix of reactive power devices and a demand management scheme. We detail our progress in our consultation documents, accompanying reports and updates, which can be found below, under the project updates.

Latest updates

30 January 2023
Since the last update about this project, our work on the grid stability device at Hamilton substation has progressed and we are on track to have this first stage of the WUNIVM project commissioned on schedule in May 2023.

Our proposal to the Commerce Commission for voltage support investment presented a staged approach, looking to address the immediate need with the first stage (the Hamilton STATCOM) and provision for a second stage when conditions required it. This approach ensures best value for New Zealand electricity consumers, from whom costs are recovered. The Commerce Commission approved our project in 2020, providing us flexibility through an incentive scheme and extended delivery timeframe to make efficient investment decisions.

Since that time, the speed of change in the electricity landscape has only increased and the conditions we look for in regard to the second stage are likely to happen much sooner than originally anticipated. An example includes the growth in demand peaks in the Auckland region in 2021 and 2022.

As such, we have decided to progress the next stage of the WUNIVM project and will invest in a second STATCOM, to be installed at our Otahuhu substation.

Last year, we used an RFP to investigate what non-transmission solutions (such as batteries and demand response services) could meet our dynamic reactive support needs in this region, and what costs and service level these could be provided at. We determined that a STATCOM is the best and most cost-effective option for delivering the reactive and other support services that are needed to ensure power quality and voltage stability on the grid at this location, at this time. We will continue to explore non-transmission solutions when future needs arise.

We will look to consult on the starting benefit-based charge for this investment in 2023.

Read our media release regarding this decision.

5 November 2020: Transpower will commence work on the first phase of its Waikato Upper-North Island Voltage Management (WUNIVM) project which will see the installation of a grid stability device at Transpower’s Hamilton substation costing approximately $60m.

The work is needed to manage potential changes in either generation or demand in the region.

Read our media release and information on the investigation into transmission alternatives

23 September 2020: The Commerce Commission has given approval to Transpower for its Waikato Upper-North Island Voltage Management (WUNIVM) major capital expenditure proposal. GM Grid Development John Clarke says the team will now take time to consider the Commission’s final decision and the current market environment, before deciding next steps.

Read the Commerce Commission's media release

The application and accompanying documents can be found in the downloads section below.

Downloads

WUNIVM Major Capex Proposal [ pdf 1.46 MB ]