Mercury has begun construction of its USD 283.57 million Puke Kapo Hau Wind Farm in Otago, a project the company says will create New Zealand's largest wind farm and deliver enough renewable electricity to power the equivalent of 92,000 homes.

Puke Kapo Hau to Add 192 MW Wind Capacity

Puke Kapo Hau is Stage 2 of the Mahinerangi Wind Farm, located west of Dunedin. The stage will add 40 turbines and 192 megawatts of installed capacity to the existing development.

Once both stages are complete, the combined wind farm will comprise 52 turbines with a total installed capacity of 228 megawatts and an expected annual generation of about 648 gigawatt hours.

Ceremony Marks Official Start of Construction

Te Rūnanga o Ōtākou initiated the groundbreaking ceremony alongside Mercury Chief Executive Stew Hamilton to officially commence construction. Clutha Mayor Jock Martin, landowners, Mercury staff, and contractors involved in the project also attended.

Te Rūnanga o Ōtākou Ūpoko Edward Ellison said the location for Puke Kapo Hau is of cultural significance for mana whenua. The name Puke Kapo Hau was recommended by Te Rūnanga o Ōtākou and means, simply, "the hill that catches the wind."

Mercury Executive GM Generation Development Matt Tolcher; Chief Executive Stew Hamilton; Clutha Mayor Jock Martin; and Mr. Ellison were photographed at the ceremony marking the start of work.

First Wind Farm Under Fast-Track Approvals Act

Puke Kapo Hau is Mercury's first renewable energy project approved under the Fast-track Approvals Act and will be the first wind farm constructed under this legislation.

Hamilton said using Fast-track has not changed the company's commitment to working with mana whenua at the place, communities, and all stakeholders.

"When it comes to developing and delivering our projects, we'll always consider the thoughts and concerns of people and the impact on the environment," Hamilton said.

Renewable Build Easing Pressure on Prices

Hamilton said New Zealand is in the middle of the fastest renewable energy build programme in its history, with unprecedented investment in new renewable generation.

As new generation comes online and increases supply, he said, it helps ease pressure on the electricity system and supports lower costs over the long term.

Hamilton pointed to wholesale electricity prices falling significantly over the past year, with average spot prices dropping from around USD 109.84 per megawatt hour to USD 44.27 per megawatt hour.

While many factors influence electricity market prices, he said, increasing supply is an important part of improving affordability and reducing overall system costs over time.

Datagrid Partnership Ties Supply to New Demand

Puke Kapo Hau is positioned to support growing electricity demand, including from Datagrid, which is developing what is expected to be New Zealand's most advanced and most suitable large-scale data centre project in Southland.

Mercury holds a 140-megawatt power purchase option agreement with Datagrid and has invested USD 29.70 million for a 12.7 percent minority stake in Datagrid NZ.

Hamilton said data centres can play an important role in New Zealand's economic growth, but new demand needs to be matched by investment in new electricity generation.

"By developing demand and supply together, New Zealand can support growth while maintaining energy security and helping manage long-term electricity costs," Hamilton said.

Construction Timeline and Economic Impact

The wind farm will take about two years to construct, with up to 200 people working on the site each day during peak construction.

The project is expected to inject about USD 123.29 million into the New Zealand economy, of which about USD 40.91 million will flow into the Otago and Southland economies via contractors and workers directly involved in construction.

The project will generate additional economic activity for local suppliers, accommodation providers, retailers, and service businesses.

Once operational, the wind farm will employ around 8 to 10 full-time staff and will rely on local and regional subcontractors across many trades to operate and maintain the turbines over 30 years.

Nordex Supplies Turbines in New Zealand First

Puke Kapo Hau will be the first wind farm in New Zealand to have wind turbines supplied by Nordex Group, a leading global wind energy company based in Germany.

Hamilton noted Nordex has had a significant presence in Australia for many years and said Mercury is happy to be supporting a new wind technology supplier to enter the New Zealand market.

Community Fund for Otago

Mercury is also strengthening its partnerships in the Otago community with an annual fund to support people and projects around the wind farm.

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