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The Whirinaki thermal reserve plant in Hawkes Bay is to be sold, the Government announced today.
Plans had been made for the diesel-fired reserve generator to be transferred to Meridian Energy, but Energy and Resources Minister Gerry Brownlee said today it would instead be sold on the New Zealand market by tender.
"Meridian has advised the Government that it does not want the plant, and the Government considers that the electricity market will be best served by selling the plant by open tender," he said.
The Government last year accepted a recommendation from the ministerial review of the electricity market that the reserve energy scheme be abolished and the Whirinaki plant sold.
Whirinaki, commissioned in 2004 and operated by Contact Energy, comprises three diesel-fired units totalling 155 megawatt.
Mr Brownlee said the plant's sale would be subject to conditions that it only be relocated in the summer of 2011/12 or 2012/13, and that it remained in an operating condition in New Zealand for at least three years following the sale.
The tender would be undertaken by the Ministry of Economic Development and Treasury.