Government plans to double geothermal energy produced for electricity and heating
Photo:
RNZ / Samuel Rillstone
The government has released a draft plan to double the amount of geothermal energy produced for electricity and heating within 15 years.
Resources Minister Shane Jones said the draft strategy would unlock New Zealand's geothermal potential, extend New Zealand's position as a world leader in geothermal innovation and strengthen regional economies and the Māori economy.
"I see potential for our geothermal sector to expand and diversify into areas such as the extraction of minerals from geothermal fluid, the development of globally sought-after innovation and science, and more use of direct geothermal energy to power industrial, commercial and agricultural applications," he said.
According to the Ministry for Business, Innovation and Employment (MBIE), New Zealand's first, and the world's second, geothermal power station was Wairakei͕, which opened in 1958 and in 2024 geothermal fields generated almost 20 percent of the country's electricity.
Contact Energy's Tauhara geothermal power station opened in late 2024.
Geothermal heat is also used for industrial processes including drying timber and manufacturing tissues.
Upfront costs for drilling new wells have been put at $10-15 million per well.
The draft strategy said much of the current infrastructure was built on exploration by the Crown decades ago, and there needs to be more coordination between scientists, government, industry and tangata whenua.
Among the proposals are "recalibrating" planning laws to be more enabling and adaptive, using government-private partnerships to fund feasibility and demonstration projects, commissioning new research and making data on geothermal resources publicly available.
The draft plan also proposes reviewing the Emission Trading Scheme settings to see if they are limiting the uptake of geothermal heat.
Also on the list are exploring a new Geothermal Centre of Excellence, looking at tourism opportunities in Taupō and Tarawera in partnership with iwi, and considering the need for Crown involvement in exploration or modelling.
The draft timeline points to possible Crown-backed exploration starting from 2029.
No funding has yet been attached to the proposals.
The country's electricity demand is expected to rise by 68 percent over the next 25 years.
Geothermal power can be used to underpin rapid growth in solar and wind generation, as the government aims for its goal of doubling the supply of renewable energy.
Like hydro power, geothermal energy can provide a low-carbon and consistent source of electricity when the sun and wind aren't generating enough supply.
But unlike hydro, the government sees big potential for geothermal to grow - and it doesn't rely on rainfall levels.
The government has previously ring-fenced $60 million from the Regional Infrastructure Fund to explore for
supercritical geothermal resources
, extra-hot fluids below 5km deep.
The government said $5 million of that funding has been drawn down for work on the detailed design and cost to drill the first of three exploratory deep wells in the Taupō Volcanic Zone.
The strategy is open for submissions until 12 September.
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