Transpower plans to spend $193 million on upgrading the power grid in the upper South Island as electricity demand in the region continues to grow.

The regulated national grid operator said it had submitted a proposal on the upgrade to the Commerce Commission.

The option put forward by Transpower is to build two new switching stations near Ōrari and Rangitata, upgrade two transmission lines through the Waitaki Valley, and install voltage management equipment.

Transpower grid development executive general manager Matt Webb said the proposed grid upgrades would strengthen the transmission network and ensure areas north of Twizel would continue to have a reliable electricity supply.

“Demand in these areas has been growing steadily, particularly during the summer months when power is used for irrigation,” he said.

“With more homes and businesses switching to electricity use, and forecast electrification of South Canterbury’s farming and primary processing sectors, demand for electricity is expected to increase even further,” he said.

There is limited electricity generation north of Twizel, so power travels from the Waitaki Valley via high-voltage transmission lines to Christchurch and further north to reach the top of the South Island, Transpower said.

Webb said electricity transmitted over long distances needs voltage support to keep the supply stable and avoid surges or other disruptions.

“Our proposed upgrades will create connections between existing electricity circuits, increase transmission line capacity, and help keep voltage stable,” he said.

Transpower is also considering what other solutions could support or defer this investment.

Its proposal includes $7m for initiatives that could defer or avoid some investment in transmission infrastructure.

“Non-transmission solutions” include large batteries and demand response deals, where industrial customers or electricity retailers work with their customers to shift demand away from peak demand periods.

Transpower said the investment would ensure the upper South Island’s network had the strength and resilience it needed to meet increased demand into the 2030s.

Jamie Gray is an Auckland-based journalist, covering the financial markets, the primary sector, and energy. He joined the Herald in 2011.