Shoring up your power supply in the Coromandel region
Consultation closed on 2 May 2021
With more people choosing to live and visit the Coromandel region, comes a much greater demand for power. This means there are now times during the year – mainly public holidays and long weekends – when the level of demand is greater than our network was originally designed to deliver.
There’s now a chance of losing power during these times of peak demand, and this will increase as the region’s electricity demand continues to grow.
We know that there’s never a good time to be without power. That’s why we’re working towards a solution that will support your community’s power supply into the future, peak times included.
Back in 2017, our team considered options and identified that a traditional approach, which would involve building new overhead power lines to increase the capacity of our existing network, would address the issue.
The timing is now right to address the issue and we want to ensure that it aligns with your community’s priorities, particularly given there are other options available, which don’t necessarily involve putting up more poles and wires. From our discussions with the communities we serve over the last few years, we believe that customers want the lowest cost solution, that in addition meets reliability expectations and has the least impact on the environment.
If these priorities are shared by the Coromandel community, there is an alternative to a traditional (poles and wires) approach. This is the installation of modern diesel generators in three site locations: Whitianga, Matarangi and Coromandel Town. These would provide a back-up supply that will kick into action to keep the power on, but only in the event it is needed. In fact, the total time the diesel generators would be expected to run for the three areas is a maximum of eight days. This means the environmental footprint is low and can be installed quicker than other available options.
Using this type of generation means we can continue to deliver a safe and reliable power supply to your community at the lowest cost to you.
While we believe that diesel generators are the best option from a cost, reliability and environmental perspective, we’re continuing to explore other alternatives at the same time. This will make sure we deliver the solution that best meets these needs.
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Powerco is investing in the Coromandel region to improve the reliability of power supply to the community. Due to geographical challenges in the region and the fact there are now times during the year when the level of demand for power is greater than our network was originally designed to deliver, we know that residents and businesses can experience power outages.
We understand the disruption outages cause and the risk of losing power during these times of peak demand will increase as the region continues to grow.
That’s why we’re working towards a solution that will support your community’s power supply into the future, including during times when demand peaks.
When there’s an influx of visitors to the region. This is mainly during long weekends, public holidays, and other times of the year when people take a break such as the Christmas/New Year holiday period and Easter.
Our investment in this project will improve the reliability of power supply to residential customers and business located in the areas identified on the maps below:
There are several ways to address the issue from an engineering perspective.
Back in 2017, as part of our five-year investment programme, our team considered options and identified that a traditional approach, which would involve building new overhead power lines to increase the capacity of our existing network, would address the issue.
Since then our thinking has evolved and we’re considering alternatives that can be delivered sooner, keep the costs down for our customers, minimise the environmental impact and improve the reliability of our power supply.
The solution most closely aligned with the priorities of our customers involves the installation of modern diesel generators in three site locations: Whitianga, Matarangi and Coromandel Town. This would provide a back-up supply that will kick into action to keep the power on, in the event it is needed.
We’re also continuing to explore what other options are available for providing additional supply during times of peak demand so that we can assess these as part of our decision-making process. This is to ensure we deliver the solution that best meets the needs of your community.
Initially, this was the thinking we built into our five-year investment programme; however, we have revisited our approach largely due to the associated costs, which are then passed back to our customers through their power bill.
The Coromandel region is a beautiful part of our network, but there are significant challenges posed by the terrain, which translates into significant costs when building poles and wires.
Added to this, because the population fluctuates so much between the quiet periods and times when people flock to the region for a holiday, we realise that a new permanent supply isn’t the best solution. With the use of modern diesel generators for example, we can install a back-up supply that will kick into action only when needed, therefore limiting the impact on our carbon footprint.
The geography of the region presents challenges posed by the rugged terrain, and this translates into significant costs when building poles and wires. Finding a more cost-effective solution is so important as these costs are passed back to customers through their power bill.
Over the years, customers across our network have said they want a reliable network, with minimal environmental impact that can be delivered in time to address the risk of increased outages, and at the lowest cost.
With this in mind, we’re carefully considering options that will improve the reliability of power supply to your community into the future.
Yes, in fact we’ve used these to support the network in the Coromandel and Whitianga previously. One of our modern diesel generators currently resides at our Whangamata substation, to kick in when needed to support power supply for the local community. Safety is our highest priority and our processes allow the safe connection and operation of generators.
The generators would be used to provide a back-up supply, kicking into action only when needed during times of peak demand.
We estimate that the total time the generators would be used is the equivalent of up to eight days a year across the three sites.
This means the carbon footprint is low as they are only generating power to support the network at peak times, when needed.
As a regulated business, the cost of maintaining and enhancing the performance of our network is passed back to our customers through their power bill. This means we need a solution that is cost-effective.
To help give you an idea of how your bill may be impacted, we’ve estimated the increase in distribution charges that will take affect from March 2023.
Although this is based on moving forward with modern diesel generators (if this aligns with your priorities as a community), it provides a better understanding of how your prices may be affected. The impact on your electricity bill will depend on your circumstances and how your retailer chooses to repackage these changes for you.
For our residential customers, we estimate an increase of between $2.15 and $3.50 per month.
For our commercial customers, our modelling suggests an increase of between 4%-7.5% of the distribution charge indicated on your bill.
We’re in the early stages of this project. As a first step, we’re working through ensuring that we deliver the solution that best meets the needs of your community and aligns with your priorities and values.
We’re continuing to explore other alternatives to ensure we’ve considered all the options that meet the criteria of low cost, high reliability, timeliness, and low environmental impact.
If during our decision-making process, it’s confirmed that the installation of modern diesel generators is the best option based on your feedback and our comparison with alternatives, this will take up to a couple of years to deliver. Unfortunately, we’re unable to provide clearer timeframes now as there are several factors that influence how long it will take to deliver, including gaining access to the sites where the generators will be located.
In comparison with other options, diesel generators can be delivered much faster as we are not required to build network infrastructure. We will keep you updated regularly as we progress.
As well as talking to retailers, we’re engaging with representatives from Thames-Coromandel District Council, Iwi, and other key stakeholders within your community. To ensure they are all well informed and can share their views, as well as helping us raise awareness and communicate our progress along the way.
Here's an overview of the timeline:
Network support options
23 March - 23 April: Registrations of interest (ROI) for delivering network support in market.
27 April - 14 May: ROI evaluation period
29 March - 2 May: Community engagement
3 - 17 May: Engagement feedback report
22 June: Presentation to Powerco Board