Contact Energy to Keep Taranaki Power Plant Open for Next Winter

Highlights:

• Winter Readiness: Contact Energy Limited (NZX: CEN) will keep its Taranaki Combined Cycle Plant open for the upcoming winter, dependent on gas supply and customer demand.
• Green Expansion: The company has approved Te Mihi Stage 2, a 101 MW geothermal plant, as part of its strategy to replace the aging Wairakei power station and enhance renewable energy output.
• Balancing Act: Contact Energy aims to support New Zealand’s grid by balancing investment in renewable projects with maintaining reliable backup through its gas-fired generation plant.

Gas Availability and Customer Demand Drive Decision

Contact Energy Limited (NZX: CEN) plans to keep its Taranaki Combined Cycle Plant operational for the coming winter season, contingent upon securing adequate gas supplies and identifying customers willing to pay for the power generated, according to CEO Mike Fuge. Speaking at the company's recent annual shareholder meeting, Fuge emphasized that while Contact aims to support the national grid, access to resources and market demand will play pivotal roles in this endeavor.

Investment in Renewable Energy

In a move toward greener energy solutions, Contact has officially approved the construction of Te Mihi Stage 2, a 101-megawatt geothermal facility. This project, designed to eventually replace the aging Wairakei geothermal power station from the 1950s, represents Contact’s commitment to sustainable and long-term energy production in New Zealand.

Future of Gas-Fired Generation

While Contact is committed to increasing its renewable energy portfolio, it acknowledges the importance of maintaining reliable gas-fired generation in the near term. At the time of writing, Contact’s Taranaki facility remains a crucial backup during high-demand periods, but its operation will ultimately hinge on the successful acquisition of gas and customer agreements for electricity use.

Strategic Shifts in Energy Planning

Contact’s recent decisions underscore the company’s dual approach: investing in renewable infrastructure while ensuring backup capacity is available to meet potential power shortages.

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