Industries to sell power to grid

Press, 8 November 1978, Page 14

Industries to sell power to grid

i NZPA Wellington ‘ Industries with large generating plants will be able to sell their surplus electricity for the national grid from next April. A “buy-back” formula has just been agreed by the Electrical Supply Authorities’ Association and the Government enabling industries to feed - the national grid and draw from it when the need

arises. A handful of local supply authorities alreadv ( have buy-back agreements ; with select industries in I their areas but the vast majority of the country’s approximately 60 authorities have resisted the ! scheme. The smaller supply ( authorities have argued they would be placed in financial difficulty if one ( or two of their large I industrial consumers ' stopped buying electricity. Other supply authorities

have been reluctant to give up industries because of the revenue they would lose. As a result, the development of co-generation in New Zealand has tended to suffer, industry sources say. Co-generation is the generation of both useful electricity and heat in the same plant using a gas turbine. The plant, because it harnesses the turbine’s exhaust, is much more efficient than traditional powerhouse systems. But many -industries, requiring heat rather than electricity, have steered iway from co-generation. With local supply luthorities refusing to buy back the electricity, running the plant solely for heat would have been too costly. In the' interests of national energy conservation, the Government in this year’s Budget undertook

to establish a "buy-back” arrangement.

The electricity forecasting engineer for the Minister of Energy. Mr David Cook, said a formula had been worked out with the Electrical Supply Authorities' Association which would allow all authorities to buy back electricity. The formula would apply to existing as well as future plants.

“The arrangements are aimed at paying for 'buyback’ at a price closer to what the electricity's worth. giving supply authorities some benefit, and leaving other benefits for the ordinary consumer," said Mr Cook

"If it is organised right, everybody stands to gain.” The formula, which provides a framework for supply authorities to individually negotiate buyback arrangements, has yet to be ratified by the authorities.