Contractor’s paperwork delay rips Network Tasman’s prices are changing

Network Tasman owns and operates the electricity distribution network in the wider Nelson and Tasman areas, excluding Nelson Electricity’s supply area in Nelson city.

Network Tasman will increase its lines charges for residential consumers by 0.5% from 1 April 2023. This change will increase the average residential consumer’s lines charges by about $5 per year. The main reasons for the increase are to recoup increases in the inflationary costs of maintaining our network, the cost of which is offset by reduced transmission costs allocated to our network by Transpower.

Network Tasman is regulated by the Commerce Commission, which sets the amount of revenue we can earn. As a consumer-owned network, we aim to deliver a cost-efficient service for our consumers. It is this consumer focus that means we consistently recover less revenue than is allowed by the Commerce Commission. Next year (2023/24), our charges are forecast to be $3.3 million less than the amount the Commerce Commission says we can charge.

Network Tasman’s residential distribution prices are currently one of the lowest charged by electricity distribution companies across the country (according to the MBIE Quarterly Survey of Domestic Electricity Prices, November 2022). Network Tasman expects this to remain the case when the new prices are introduced in April.

JO RICHARDS

Three years after first visiting the site of the Waimea Dam, The GB Weekly returned last Friday for a good look at the almostcompleted structure.

But just as the finishing touches are being applied, a new problem has arisen - not with rock, concrete, or steel - but paper. A delay in the provision of crucial quality assurance documents by the contractor has thrown an untimely spanner into the massive waterworks. More on that later.

Standing on the crest of the dam, 50m above the river, looking along its 220m rock-filled face, it is hard not to be taken aback by the sheer immensity of the construction – an impression reinforced by some of the mind-boggling statistics that Waimea Water Limited CEO Mike Scott reels off as second nature. “[It contains] 490,000 cubic metres of rock, 32,000 cubic metres of concrete, 3,000 tonnes of rebar...”

Other statistics boggle minds in different ways. Since its inception, the project has been dogged by cost increases and delays. A perfect storm of geological surprises, covid restrictions, and supply chain problems, have all contributed to a doubling of costs since Tasman District Council (TDC) voted to give the go-ahead in November 2018. At that time, the project was costed at $105.9 million with a “P95” level of confidence. Although it was never fully explained (or perhaps understood), the P95 figure was keenly quoted by proponents of the dam when rebuffing the concerns about possible overruns. But even the most pessimistic critic may not have foreseen the blow-out soaring to almost $200 million.

During the November 2018 debate leading up to the final vote, when then-Mayor Richard Kempthorne was questioned about the uncertainty surrounding the bedrock at the dam site, he provided an unequivocal assurance that the samples and 3D modelling had identified no problems.

In hindsight, the erstwhile mayor’s response encapsulates what Mike may be referring to when he talks of an early “over optimistic” attitude towards the project.

The unwelcome geological discoveries in 2019 prompted a rapid and significant redesign of the embankment, notably the incorporation of a drainage blanket through the dam embankment, and a major upgrading of the spillway, approach apron, and plunge pool.

Mike is clearly proud of the way his team responded to the complex design and engineering challenges. “Kudos to WWL and our consultants…We have one of the best designed and built dams in New Zealand.”

Walking on the uppermost section of the curved, 40m-wide concrete spillway, the CEO points out how critical this structure is to the functioning of the dam: “Eighty-five per cent of the water from the dam will go down the spillway.” The concrete chute narrows as it drops 30m before curving up at the flip bucket, a feature designed to dissipate the energy in the cascading water by hurling it up in the air, thus allowing it to fall benignly into the plunge pool. At times there will be a lot of water running down the spillway; the maximum flow rate is calculated to be around 1,100 cumecs – equivalent to an Olympic-size swimming pool every two seconds.

This year Network Tasman has also introduced time-ofuse price plans for most consumers. These price plans more closely reflect the cost of providing power during different times of the day. This new price plan gives consumers more opportunities to reduce their power bills by switching usage to coincide with the cheaper off-peak times of the day (between 11pm and 7am). The overall impact of this change will depend on a few things, such as how and when you use electricity and whether your retailer chooses to pass this change on to you through their retail prices.

If you are interested in finding out more, please visit our website: networktasman.co.nz/network-pricing

As he overlooks the front face of the dam, Mike explains that around half of the $90 million cost overrun was attributed to the site’s geology. When excavation began in 2019, instead of finding hard sandstone, workers uncovered flaky argillite, unsuitable for construction of the dam. The discovery meant that an enormous quantitiy of rock had to be imported from a nearby quarry, while a significant shear zone was identified on the side slope where the spillway was to be constructed.

Although work continues on the dam’s final major element – the approach apron adjacent to the spillway – Mike says that the reservoir, which will eventually hold back 13 billion litres of water, could now be closed and filled had the necessary documents been submitted on time. “It’s frustrating waiting for the paperwork.”

The delay by joint venture contractor Fulton Hogan in providing the quality assurance documentation required for