The expansion will involve adding 55 turbines to the existing 48 and increase output capacity from 32MW to 68MW. The project is expected to be finished by May next year.
Energy Minister Pete Hodgson welcomed this TrustPower initiative as "a welcome and significant addition" to New Zealand's renewable energy supply.
"This extra generation capacity will help reduce demand for thermal electricity generation and will be a welcome addition to power supplies for next winter. That is good news both for the environment and for the security of the nation's electricity supply."
Hodgson said he was pleased the allocation of Kyoto Protocol emission units, or 'carbon credits', had enabled TrustPower to go ahead with the project. "By allocating carbon credits to firms building clean, renewable energy plants the government can help ensure they are economically viable.
"Electricity from renewables avoids some gas or coal-fired generation, with its associated greenhouse gas emissions, which helps New Zealand meet its emission reduction target."