New Zealand seeks growth as Australia ails

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Richard Heap
August 28, 2015
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New Zealand seeks growth as Australia ails

For those of us based in western Europe there are few places as remote as New Zealand. It is one of those holiday-of-a-lifetime destinations that few of us will get round to actually visiting.

With a journey time of a day or more, it would be a big commitment for most wind investors to make the trip too. But New Zealand has a growing wind market and potential investment opportunities, so is it worth digging out your best plane socks and jumping on a flight?

The raw numbers show New Zealand is taking renewables more seriously than Australia is under the destructive regime of Prime Minister Tony Abbott — though it could hardly be doing any worse.

The 2015 version of the New Zealand government’s annual ‘Energy in New Zealand’ report shows that renewables made up an impressive 40% of the country’s primary energy supply in 2014.

It gets less impressive when we look at the figures for wind, though. Less than 1% of the total energy supply came from wind farms. The 690MW of capacity in 19 projects means wind lags far behind three other renewable sources: geothermal, hydro and bioenergy.

There are growth plans, though. The New Zealand Wind Energy Association says there are 2.5GW of wind farms consented in the country, and that developers are on the lookout for sites for new schemes. These projects will need to be funded somehow.

Again, this is unlikely to be enough to attract investors that have not previously looked at that part of the world. There are other markets with bigger ambitions for wind — Brazil, India, South Africa and Turkey to name just four — that are easier for European investors to get to. There are also opportunities in other nations within the European Union. Against that backdrop, New Zealand is a long way to go for a relatively small emerging market.

But it will be of interest to some, and this is where the relationship with Australia is key. As Abbott continues with his ‘anti-wind’ assault in Australia, we would expect investors that have been looking at schemes in Australia to cast their eyes across the Tasman Sea.

For example, Meridian Energy has said it plans to avoid investing in Australia while Abbott is in charge. Meridian is New Zealand’s largest electricity firm and co-developed Australia’s largest wind farm, the 420MW Macarthur project, but has chosen not to pursue any of the 100 projects it has looked at in Australia over the last year. It is now looking to build wind in New Zealand as the nation gets set to close its last large coal-fired power stations in 2018.

Overseas investors who are considering investing in New Zealand will undoubtedly see more competition in the country from the firms that are being pushed out of Australia.

European investors could see that as a negative, but there is a positive side. If experienced developers bring forward new projects in New Zealand then that should mean opportunities for overseas investors to link up with those who really know the market. This can help to de-risk investments by taking advantage of local knowledge.

It will not be for everyone of course, but no emerging market is.

For those of us based in western Europe there are few places as remote as New Zealand. It is one of those holiday-of-a-lifetime destinations that few of us will get round to actually visiting.

With a journey time of a day or more, it would be a big commitment for most wind investors to make the trip too. But New Zealand has a growing wind market and potential investment opportunities, so is it worth digging out your best plane socks and jumping on a flight?

The raw numbers show New Zealand is taking renewables more seriously than Australia is under the destructive regime of Prime Minister Tony Abbott — though it could hardly be doing any worse.

The 2015 version of the New Zealand government’s annual ‘Energy in New Zealand’ report shows that renewables made up an impressive 40% of the country’s primary energy supply in 2014.

It gets less impressive when we look at the figures for wind, though. Less than 1% of the total energy supply came from wind farms. The 690MW of capacity in 19 projects means wind lags far behind three other renewable sources: geothermal, hydro and bioenergy.

There are growth plans, though. The New Zealand Wind Energy Association says there are 2.5GW of wind farms consented in the country, and that developers are on the lookout for sites for new schemes. These projects will need to be funded somehow.

Again, this is unlikely to be enough to attract investors that have not previously looked at that part of the world. There are other markets with bigger ambitions for wind — Brazil, India, South Africa and Turkey to name just four — that are easier for European investors to get to. There are also opportunities in other nations within the European Union. Against that backdrop, New Zealand is a long way to go for a relatively small emerging market.

But it will be of interest to some, and this is where the relationship with Australia is key. As Abbott continues with his ‘anti-wind’ assault in Australia, we would expect investors that have been looking at schemes in Australia to cast their eyes across the Tasman Sea.

For example, Meridian Energy has said it plans to avoid investing in Australia while Abbott is in charge. Meridian is New Zealand’s largest electricity firm and co-developed Australia’s largest wind farm, the 420MW Macarthur project, but has chosen not to pursue any of the 100 projects it has looked at in Australia over the last year. It is now looking to build wind in New Zealand as the nation gets set to close its last large coal-fired power stations in 2018.

Overseas investors who are considering investing in New Zealand will undoubtedly see more competition in the country from the firms that are being pushed out of Australia.

European investors could see that as a negative, but there is a positive side. If experienced developers bring forward new projects in New Zealand then that should mean opportunities for overseas investors to link up with those who really know the market. This can help to de-risk investments by taking advantage of local knowledge.

It will not be for everyone of course, but no emerging market is.

For those of us based in western Europe there are few places as remote as New Zealand. It is one of those holiday-of-a-lifetime destinations that few of us will get round to actually visiting.

With a journey time of a day or more, it would be a big commitment for most wind investors to make the trip too. But New Zealand has a growing wind market and potential investment opportunities, so is it worth digging out your best plane socks and jumping on a flight?

The raw numbers show New Zealand is taking renewables more seriously than Australia is under the destructive regime of Prime Minister Tony Abbott — though it could hardly be doing any worse.

The 2015 version of the New Zealand government’s annual ‘Energy in New Zealand’ report shows that renewables made up an impressive 40% of the country’s primary energy supply in 2014.

It gets less impressive when we look at the figures for wind, though. Less than 1% of the total energy supply came from wind farms. The 690MW of capacity in 19 projects means wind lags far behind three other renewable sources: geothermal, hydro and bioenergy.

There are growth plans, though. The New Zealand Wind Energy Association says there are 2.5GW of wind farms consented in the country, and that developers are on the lookout for sites for new schemes. These projects will need to be funded somehow.

Again, this is unlikely to be enough to attract investors that have not previously looked at that part of the world. There are other markets with bigger ambitions for wind — Brazil, India, South Africa and Turkey to name just four — that are easier for European investors to get to. There are also opportunities in other nations within the European Union. Against that backdrop, New Zealand is a long way to go for a relatively small emerging market.

But it will be of interest to some, and this is where the relationship with Australia is key. As Abbott continues with his ‘anti-wind’ assault in Australia, we would expect investors that have been looking at schemes in Australia to cast their eyes across the Tasman Sea.

For example, Meridian Energy has said it plans to avoid investing in Australia while Abbott is in charge. Meridian is New Zealand’s largest electricity firm and co-developed Australia’s largest wind farm, the 420MW Macarthur project, but has chosen not to pursue any of the 100 projects it has looked at in Australia over the last year. It is now looking to build wind in New Zealand as the nation gets set to close its last large coal-fired power stations in 2018.

Overseas investors who are considering investing in New Zealand will undoubtedly see more competition in the country from the firms that are being pushed out of Australia.

European investors could see that as a negative, but there is a positive side. If experienced developers bring forward new projects in New Zealand then that should mean opportunities for overseas investors to link up with those who really know the market. This can help to de-risk investments by taking advantage of local knowledge.

It will not be for everyone of course, but no emerging market is.

For those of us based in western Europe there are few places as remote as New Zealand. It is one of those holiday-of-a-lifetime destinations that few of us will get round to actually visiting.

With a journey time of a day or more, it would be a big commitment for most wind investors to make the trip too. But New Zealand has a growing wind market and potential investment opportunities, so is it worth digging out your best plane socks and jumping on a flight?

The raw numbers show New Zealand is taking renewables more seriously than Australia is under the destructive regime of Prime Minister Tony Abbott — though it could hardly be doing any worse.

The 2015 version of the New Zealand government’s annual ‘Energy in New Zealand’ report shows that renewables made up an impressive 40% of the country’s primary energy supply in 2014.

It gets less impressive when we look at the figures for wind, though. Less than 1% of the total energy supply came from wind farms. The 690MW of capacity in 19 projects means wind lags far behind three other renewable sources: geothermal, hydro and bioenergy.

There are growth plans, though. The New Zealand Wind Energy Association says there are 2.5GW of wind farms consented in the country, and that developers are on the lookout for sites for new schemes. These projects will need to be funded somehow.

Again, this is unlikely to be enough to attract investors that have not previously looked at that part of the world. There are other markets with bigger ambitions for wind — Brazil, India, South Africa and Turkey to name just four — that are easier for European investors to get to. There are also opportunities in other nations within the European Union. Against that backdrop, New Zealand is a long way to go for a relatively small emerging market.

But it will be of interest to some, and this is where the relationship with Australia is key. As Abbott continues with his ‘anti-wind’ assault in Australia, we would expect investors that have been looking at schemes in Australia to cast their eyes across the Tasman Sea.

For example, Meridian Energy has said it plans to avoid investing in Australia while Abbott is in charge. Meridian is New Zealand’s largest electricity firm and co-developed Australia’s largest wind farm, the 420MW Macarthur project, but has chosen not to pursue any of the 100 projects it has looked at in Australia over the last year. It is now looking to build wind in New Zealand as the nation gets set to close its last large coal-fired power stations in 2018.

Overseas investors who are considering investing in New Zealand will undoubtedly see more competition in the country from the firms that are being pushed out of Australia.

European investors could see that as a negative, but there is a positive side. If experienced developers bring forward new projects in New Zealand then that should mean opportunities for overseas investors to link up with those who really know the market. This can help to de-risk investments by taking advantage of local knowledge.

It will not be for everyone of course, but no emerging market is.

For those of us based in western Europe there are few places as remote as New Zealand. It is one of those holiday-of-a-lifetime destinations that few of us will get round to actually visiting.

With a journey time of a day or more, it would be a big commitment for most wind investors to make the trip too. But New Zealand has a growing wind market and potential investment opportunities, so is it worth digging out your best plane socks and jumping on a flight?

The raw numbers show New Zealand is taking renewables more seriously than Australia is under the destructive regime of Prime Minister Tony Abbott — though it could hardly be doing any worse.

The 2015 version of the New Zealand government’s annual ‘Energy in New Zealand’ report shows that renewables made up an impressive 40% of the country’s primary energy supply in 2014.

It gets less impressive when we look at the figures for wind, though. Less than 1% of the total energy supply came from wind farms. The 690MW of capacity in 19 projects means wind lags far behind three other renewable sources: geothermal, hydro and bioenergy.

There are growth plans, though. The New Zealand Wind Energy Association says there are 2.5GW of wind farms consented in the country, and that developers are on the lookout for sites for new schemes. These projects will need to be funded somehow.

Again, this is unlikely to be enough to attract investors that have not previously looked at that part of the world. There are other markets with bigger ambitions for wind — Brazil, India, South Africa and Turkey to name just four — that are easier for European investors to get to. There are also opportunities in other nations within the European Union. Against that backdrop, New Zealand is a long way to go for a relatively small emerging market.

But it will be of interest to some, and this is where the relationship with Australia is key. As Abbott continues with his ‘anti-wind’ assault in Australia, we would expect investors that have been looking at schemes in Australia to cast their eyes across the Tasman Sea.

For example, Meridian Energy has said it plans to avoid investing in Australia while Abbott is in charge. Meridian is New Zealand’s largest electricity firm and co-developed Australia’s largest wind farm, the 420MW Macarthur project, but has chosen not to pursue any of the 100 projects it has looked at in Australia over the last year. It is now looking to build wind in New Zealand as the nation gets set to close its last large coal-fired power stations in 2018.

Overseas investors who are considering investing in New Zealand will undoubtedly see more competition in the country from the firms that are being pushed out of Australia.

European investors could see that as a negative, but there is a positive side. If experienced developers bring forward new projects in New Zealand then that should mean opportunities for overseas investors to link up with those who really know the market. This can help to de-risk investments by taking advantage of local knowledge.

It will not be for everyone of course, but no emerging market is.

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Not a member yet?

Become a member of the 6,500-strong A Word About Wind community today, and gain access to our premium content, exclusive lead generation and investment opportunities.