Government-owned Genesis Power and Mighty River Power are considering appealing the decision, which could affect not only the Tongariro and Waikato power stations but add fuel to the LNG-coal-gas-renewables debate.

The DominionPost today reports that Genesis and MRP are scrutinising the 135-page environment court document, to decide whether to appeal the decision to cut Tongariro water rights to 10 years with no guarantee of renewal.

Whanganui Maori, who say they were never consulted about the Tongariro scheme during its construction, appealed to the environment court about resource consent renewals. The court agreed with them and Whanganui River Trust Board chairman Archie Taiaroa has said Maori want water diversion to stop, which could force the closure of the Tongariro scheme.

The decision adds more uncertainty to the electricity supply picture that is already clouded by rising demand, dry-year hydro shortages, limited investment in new power stations, and the March collapse of Meridian Energy’s South Island Project Aqua scheme.

Although Genesis does not own any Waikato stations - MRP does - it needs Waikato River water for cooling its 1000MW Huntly power station. Genesis generation and trading manager Dean Carroll has said if Waikato River flows are significantly reduced, water temperatures and generation from Huntly could be affected.

Meanwhile, the newly-established Electricity Commission has said it will cost about NZ$42.5 million to run in the year to June 2005. Industry players are paying for the commission's costs through a levy and are likely to pass that on to consumers in electricity prices.

Most of the cost, about NZ$37 million, will be commission payments to service providers to run the wholesale electricity market - such as national grid owner-operator Transpower and M-co, which monitors and operates wholesale and hedge electricity trading markets.