New Zealand’s Transpower gets green light for $631m HVDC inter-island upgrade

Capacity and reliability will be boosted.

Transpower has secured final approval from the Commerce Commission for its $631m (NZ$1.1b) investment to upgrade the country’s high voltage direct current (HVDC) inter-island electricity link.

The HVDC link connects the North and South Islands and is critical to national electricity supply, enabling power transfer between regions to support reliability, stability, and lower-cost electricity.

The approved investment will replace ageing infrastructure, including four undersea cables across Cook Strait that are approaching the end of their 40-year design life, and will install new cable termination stations at both ends of the link.

Chief Executive James Kilty said the link plays a key role in New Zealand’s power system by enabling efficient electricity sharing, supporting grid stability with increasing renewable generation, and improving overall system resilience.

“Having this decision now, with a good lead-in time, means we will be able to confirm a contract with the manufacturer of the new cables in time for them to be delivered and installed in the early 2030s when replacement is due,” he added. “This reduces the risk of unplanned outages as the existing cables age.” 

The decision covers Stage One of a wider HVDC upgrade programme. A separate Stage Two proposal, focused on control system and IT upgrades, will be submitted later this year.

Transpower said it is also reviewing options for the existing cables once replaced, including potential removal or decommissioning strategies.