An illustration of Far North Solar Farm’s consented 38-hectare solar farm in Marton, Rangitīkei.
Photo: Supplied / Far North Solar Farm
A solar power company getting government investment aims to produce 15 percent of the country’s daytime electricity.
The $78 million deal between Crown-owned New Zealand Green Investment Finance (NZGIF) and Far North Solar Farm signed on Tuesday will connect five of the company’s sites to the national grid.
The five sites were in different stages of development with several entering the construction phase, Far North Solar Farm director Richard Homewood said.
He said the investment would allow them to rapidly accelerate development, and most sites would be under construction within 12-18 months, Homewood told Morning Report.
They would produce the equivalent of 15 percent of daytime electricity, allowing more of the power from hydro lakes to be used for evening demand.
The company, formed in 2019, gained consent in May for a solar farm in the Rangitīkei town of Marton and was building or had approval for others including at Pukenui in the Far North, Edgecumbe in Bay of Plenty, Waiotahe and Foxton.
The NZGIF loan would be a “big driver” to speed up solar generation, he said.
“There is a lot being done [with the government] that you’re not necessarily seeing the results for today, but within the next two to five years we’ll see more and more of this generation coming online.”
New Zealand was an open market, in that anyone could become a generator, but it was a challenging business, he said. To succeed new entrants need to understand development, consenting, finance and the electricity market. Solar returns were among the “most compelling” of new generation available.
NZGIF chief executive Sarah Minhinnick said the deal reflected its mandate to accelerate investment that decarbonised the country’s economy.
“The Connection Facility Agreement is a tailored solution, designed by NZGIF, to introduce a new pool of capital to accelerate renewable energy generation in New Zealand. We look forward to seeing more private capital driven towards these solar developments,” Minhinnick said.
Far North Solar Farm had also agreed to sign a $22m works agreement contract with Transpower.
Transpower said the grid connection agreement was the first of many around the country.
“The ability for a developer to access capital is another critical element of getting renewable energy developments off the ground,” said Transpower’s executive general manager of customer and external affairs Raewyn Moss.