My biased quotes:
The government says a Liquefied Natural Gas import facility in Taranaki will save New Zealanders about $265 million a year.
Energy Minister Simon Watts on Monday announced a contract was expected to be signed by the middle of the year, with construction finishing next year or early 2028.
“We need to get rid of the dry risk,” Luxon told reporters on Monday.
“I’m not going to guarantee, based on the advice I’ve been given the benefits outweigh the costs.”
A factsheet supplied by the government said the infrastructure costs would be paid for through a levy on electricity of between $2 and $4 /MWh.
The facility was expected to cut future prices by at least $10/MWh, and curb an expected 1.25 percent reduction in Gross Domestic Product from higher energy prices.
Procurement started in October in response to the independent Frontier report, which the government largely rejected.
The government largely rejected the recommendations of the review carried out by Frontier Economics, with sector players including Simon Bridges criticising a lack of bold action.
“It would make no economic sense to develop an LNG import terminal to meet just dry year risk as the large fixed costs would be spread over a relatively small amount of output,” the Frontier report said.
I was recently (last week) talking with a colleague about this; he is currently working on 3 major grid scale solar installations (60, 160 and 200MW); I asked what is the current cost per MW onto the grid at scale.
His response, was after about 50MW you are looking at $1M/MW; that is connected to the grid with all the bits required to supply power into the national grid.
You will conservatively achieve 2000 MWh/MW installed per year.
So for a billion dollars, we could get something like 2 TWh/year installed.
In a dry year, that is 2+ TWh not pulled from a lake.