HVDC Inter-Island - Justification For The Line

Justification For The Line

The HVDC link is an important component of the transmission system in New Zealand. It connects the transmission grids of the two islands, and is used as an energy-balancing system, helping to match energy availability and demand in the two islands.

The two islands are geographically different – the South Island is 33% larger than the North Island in land area (151,000 km2 vs 114,000 km2), but the North Island has over three times the population of the South Island (3.37 million vs 1.04 million). As a consequence, the North Island has a substantially larger energy demand. However, the South Island uses more electricity per capita due to its cooler climate and the presence of the Tiwai Point Aluminium Smelter, which at a peak demand of 640 MW is New Zealand's largest single electricity user, and the second largest load centre after the city of Auckland. In 2011, around 37.1% of the total electricity generated was consumed in the South Island, while 62.9% was consumed in the North Island. South Island generation accounted for 40.9% of the nation's electricity in 2011, nearly all (97%) from hydroelectricity, while the North Island generated the remaining 59.1% from a mixture of mainly hydroelectric, natural gas and geothermal generation, plus smaller amount of coal and wind generation.

If all currently commissioned generation is available, both islands have enough generating capacity at peak times, without the connection between the two islands. However, the HVDC link provides benefits for customers in both the South Island and North Island:

• The link provides the South Island consumers with access to the North Island’s thermal generation resources that can support the South Island demand during times of low hydro storage levels and low inflows to South Island hydro lakes.
• The link provides North Island consumers with access to the South Island’s large hydro generation resources that can support the North Island demand at times of peak load.

The link plays an important role in the New Zealand electricity market, and allows North and South Island generators to compete with each other, therefore driving wholesale electricity prices down.

The inter-island transmission system was designed as an HVDC system, despite the cost of the conversion from AC to DC and back, to suit the requirements of a long transmission line and a sea crossing.The link crosses Cook Strait, between the two islands, using submarine power cables laid along the sea floor. HVDC is more suitable than AC for transmission over long distances, and particularly where cable transmission is required, because it is typically more economic, and has lower energy losses, despite the high costs of the AC/DC conversion process.