Te Ahi o Maui (pictured) was Eastland Generation’s first geothermal power plant they built from the ground up. It is one of several well-performing assets included in the capital raise. (source: Eastland Generation)Matt Todd, Chief Executive of parent company Eastland Group said bringing a partner on board would expedite their advanced pipeline of growth. “There is nowhere else in New Zealand where you can invest in a renewable energy business that has existing assets already generating strong cash flows, a fully formed operational and development capability, and a solid growth path. It’s a very unique opportunity.”
Existing assets and development pipeline
Eastland Generation owns and operates three geothermal power plants on the Kawerau geothermal field in the Bay of Plenty region – Te Ahi o Maui (26MW), Geothermal Developments Ltd (9MW) and TOPP1 (24MW).
The Te Ahi O Maui geothermal power plant was constructed and commissioned in 2018. It was the first geothermal power station to be built in New Zealand under new health and safety legislation. The TOPP1 geothermal power plant was acquired by Eastland Generation from Maori-owned geothermal assets company NTGA in 2021.
This is in addition to a hydropower station (5MW) near Wairoa and a soon-to-be operational utility scale solar farm (5MW) based on land adjacent to Gisborne Airport.
Eastland Generation also has a significant pipeline of renewable energy projects. In the near-term, one of its key projects is the partnership with Ormat Technologies to build the 49MW geothermal power station, TOPP2.
TOPP2 is priority development
“A key driver of the capital raise is to use the funds, in part, for the development of TOPP2, a 49MW geothermal power station in Kawerau. This plant is twice the size of TOPP1 and Te Ahi o Maui,” Mr Todd said. “Similar to the TOPP1 agreement, we will purchase geothermal fuel from NTGA over the life of the power station.
“We have signed an agreement with Ormat Technologies, a leading global provider of renewable energy solutions to build and operate the power plant, with an option for Eastland Generation to purchase it.”
“The development of TOPP2 has been in the pipeline since signing the agreement for TOPP1 in 2021. Over the last two years, we’ve been working with our key suppliers to progress the development, undertake site investigations, preliminary design work and lodge resource consent applications. We’re excited about the project and operational synergies it will bring across our three existing geothermal plants.”
“TOPP2 is the most advanced of our projects and will add significant scale to our portfolio, reinforcing our position as a significant developer, owner and operator of renewable energy in the New Zealand market. Additionally, there are numerous other projects at various stages of development building long term regional energy capacity and resilience, which will be announced in the near future.”
“It will also enable us to exceed our goal of 100MW of renewable generation by 2027, while also significantly contributing to the government’s target of 100 percent renewable electricity by 2035.”
Leading the charge, together
“Now is the right time to look for a growth partner as we foresee electricity demand to grow substantially, particularly as the country moves towards the electrification of transport and process heat,” said Mr Todd. “With the support and strategic expertise of a new partner, we’re confident in our ability to accelerate our pipeline of renewable energy projects, expand our operational capacity, and advance innovation in the industry.”
The team at Eastland Generation and Trust Tairawhiti, the Eastland Group’s sole shareholder, have emphasized the preference for a partner that only brings capital, but can form meaningful relationships that can support the company’s growth objectives over the long term.
Trust Tairawhiti will provide a short-term investment of $30m to support the initial development of TOPP2.
Bringing another shareholder into the generation business will provide additional capital to allow Eastland Generation to grow, without the Trust being required to provide additional long term equity investment. This is good for the company, but it also allows the Trust to better diversify, balance its portfolio and focus on supporting the local community.
Forsyth Barr has been appointed as the advisor to run the capital raise process, which is expected to commence shortly.
Eastland Generation and Trust Tairawhiti will keep staff, stakeholders, and the community updated through key stages of the process.
