The New Zealand Environment Court has just dismissed appeals by the Taranaki Energy Watch and Auckland-based Environmental Defence Society, which had opposed the construction of the proposed second station.
They had proposed tree planting or carbon dioxide re-injection into disused oil or gas wells as two means of countering the extra emissions produced by the proposed new plant.
However, the court said any mitigation measures relating to emissions from new power stations should be imposed by central government and not courts or regional authorities. This was in light of this country's intended signing of the Kyoto Protocol, which is aimed at reducing global emissions of greenhouse gases by 2010.
The court last November approved NGC subsidiary Stratford Power Ltd's application for discharge consents for the second station, which could be built alongside the existing Taranaki Combined Cycle (TCC) plant within the next few years. However, the two protest organisations appealed that decision, as TEW did for the original TCC proposal in the mid-1990s.
NGC spokesman Keith FitzPatrick said NGC had continued with its Resource Management Act resource consent applications because the whole process occurred before the decision to divest its generation facilities had been finalised. The applications are for discharge consents for a second combined-cycle plant of up to 500MW generating capacity.
The decision as to whether or not to proceed with the development of a second station was now likely be made by the new TCC owner. NGC, however, expected to be in a position to provide further details of its divestment process within the month, he added from Wellington.
There is intense interest from the big boys in power generation in the corporation's two gas-fired stations - the 360MW TCC plant and its smaller cousin, the 118MW Southdown station in south Auckland, of which NGC owns 50%.
There is the possibility all three government-owned enterprises; Meridian Energy, Genesis Power and Mighty River Power will bid for the TCC plant.
It is known Genesis, this country's largest electricity retailer, and hydro king Meridian Energy are both definitely interested, and Mighty River may want the TCC plant to complement its hydro and geothermal stations.
Owning the station would make sense for Genesis, as it is the dominant supplier in the Taranaki region and would not have large transportation costs for locally produced power. However, the second Stratford plant could be deferred by Genesis if it is successful in its TCC bid, as it should prefer to continue with its own plans for a second plant adjacent to its existing 1000MW Huntly thermal station. A second Huntly station would be nearer to the main Auckland, Waikato and Tauranga markets.
Meridian Energy is interested in the TCC plant as owning thermal plant will give Meridian a buffer against having to reduce its own hydro generation to conserve lake levels during any cold, dry winters, as it did last year.
Mighty River will almost definitely be interested in NGC's half-stake in the Southdown plant, as it should have pre-emptive rights through its Mercury Energy subsidiary owning the other 50% of Southdown.
Contact Energy and perhaps TrustPower, which owns some small hydro stations in Taranaki, could also be interested in both the TCC and Southdown plants. Though Contact earlier this year deferred a decision on its third gas-fired station in south Auckland, it could well be interested in a half share of an existing smaller plant. Also Contact will have to "replace" the generation capacity of its aging 600MW New Plymouth power station over the next few years, and buying another existing Taranaki plant could make economic sense.
Last month NGC announced it was getting out of gas retailing and selling its power stations as it consolidated its role in the New Zealand energy market.
