Mercury Energy is understood to be considering suggesting the water level at Lake Taupo be allowed to drop during ‘dry years’, so the lake could be used as a battery when hydro power is in short supply.

The company declined to take that off the table as a partial alternative to a project being investigated by the Government to build a multibillion-dollar pumped hydro facility at Lake Onslow in Otago.

Mercury spokeswoman Shannon Goldstone said the power company was “exploring a range of storage options in the North Island at the moment and aren’t in a position to rule anything in or out”.

She later added Mercury could rule out proposing Lake Taupo as a “full” alternative to Lake Onslow, which suggests the company recognises there would be limits on how much water it could draw from the lake.

Energy Minister Megan Woods has said the Government needs to think seriously about dry-year energy storage as it moves towards 100 per cent renewable electricity generation.

The Ministry of Business, Innovation and Employment (MBIE) is expected to report on options for what it is calling the New Zealand Battery Project by the end of the year.

It is understood it wants of a minimum of 5 terawatt-hours of power storage that could be called on in dry years, which is equivalent to about 12 per cent of the country’s annual electricity usage.

Woods declined to comment on the idea of utilitising Lake Taupo.

“This is the sort of thing that will be worked through by the technical experts,” her spokeswoman said.

Waikato University hydrologist professor Earl Bardsley, a proponent of the Lake Onslow scheme, said that water levels at Lake Taupo would need to be drawn down by 12.2 metres in order to provide 5TWh.

That would be on top of the normal 1.4m fluctuation in the level of the lake, he said.

But Bardsley assumed that Mercury would only propose using Lake Taupo as a small part of the solution for the NZ Battery Project, perhaps to provide a fifth of the total power storage specified by the ministry.

He suggested allowing the lake to be drawn down by much more than an extra two metres would be not be realistic, given the cultural and overall significance of the lake.

“They would not be able to get away with more than 1TWh at Taupo without being totally ridiculous.”

Using Taupo as a dry-year battery would have implications beyond periodically allowing the lake level to fall, he said.

“In order to lower it, they would need to deepen the outlet channel or have a tunnel, and both of those I imagine would be controversial.”

Taupo mayor David Trewavas said he hadn’t been aware of the concept.

“We would be a very interested party if anything like that happened, bearing in mind it is a privately-owned lake too,” he said.

The lake bed is owned by Tuwharetoa.

Genesis Energy chief executive Marc England has raised the idea of building a pumped hydro facility on army land in the upper reaches of the upper Moawhango River near Waiouru, Stuff can also reveal.

That could potentially provide up to a complete alternative to Lake Onslow, Bardsley said.

England said it would be ideal to have such a facility in the North Island, where most power users live.

“Engineers have approached us and we have approached MBIE with some thoughts and plans and ideas around it,” England said.

“It could be a meaningful amount of pumped storage on a section of army land with relatively easy consenting, near the grid,” he said.

A Defence Force spokesman said it had not seen any proposals for that idea but expected it would be consulted in due course if that was to proceed.

“Details of any proposals would need to be provided to ascertain compatibility with activities in the Waiouru Military Training Area,” he said.

Bardsley believed the plan could be feasible.

The location would be a bit to the north of the existing Lake Moawhango, but still on army land, he said.

But he questioned whether the site might be more expensive than building at Onslow.

“If you check out the topographical maps, it wouldn’t just be a matter of one dam, but a bunch of dams and quite high ones at that to keep the water in.

“It is not like a big basin like Onslow where you can get away with a single dam.”

The facility would also require a very long tunnel, about 30km to 40km long, to pump water from Lake Taupo, he said.

England said Genesis had also proposed burning biomass at its Huntly power station in dry years, which could provide another part of an alternative to Onslow.

Meridian Energy has talked up the possibility of tackling the country’s dry year electricity problem by creating “green” hydrogen using its renewable electricity, that could be stored for times of shortage.

But Woods has made clear that, and any other alternatives, would be weighed up against the base case of constructing Lake Onslow.

Bardsley said another option might be to allow the water level at Lake Pukaki to drop all the way back to its original level before it was raised, which would release 4TWh of power, leaving a shortfall of 1TWh.

But he said the environmental impact would be undesirable.

If Lake Onslow was built, it would make sense to keep the level of Lake Taupo at about mid-level, he said.

That would be so the lake could be drawn down in the event of a temporary outage to transmission lines, such as those under the Cook Strait, carrying power north, he said.

Credit:Stuff.co.nz