Geothermal energy generation

Geothermal energy is extracted from heat deep beneath the earth’s surface. New Zealand is particularly rich in geothermal energy, especially in the Taupo and Kawerau regions.

What is geothermal energy?

Geothermal energy is extracted from heat contained in the Earth’s core. Areas of geothermal energy are usually close to the boundaries of tectonic continental plates. New Zealand has a number of geothermal areas as it sits over 2 active plates - the Indo-Australian and Pacific Plates.

Geothermal energy has many benefits such as being relatively cost effective, reliable, sustainable, and relatively environmentally friendly.

History of geothermal energy use in New Zealand

Most geothermal use in New Zealand has occurred in the Taupo and Kawerau regions, within the Taupo Volcanic Zone. Some lower temperature geothermal has a wider geographical spread (see map figure below).

Low temperature geothermal resources in New Zealand

Photo credit: A G Reyes, GNS Science


The first use of geothermal energy in New Zealand was by central North Island Māori for heating, cooking and therapeutic purposes. European settlers arriving in New Zealand discovered the charm and healing benefits of thermal springs, and a number of spa baths were set up in the Rotorua area from about 1870.

Geothermal waters were used for many years in Rotorua to heat homes, businesses and institutions. Since 1991, geothermal extraction has been managed to protect surface geothermal activity. Recent trends have been towards communal systems, with 10 or more households typically sharing a well.

In 1958, Wairakei, New Zealand's first geothermal plant, and the world's second, was opened.

Several new plants and efficiency-enhancing second-stage equipment have since been added. Contact Energy’s plant at Te Mihi went online in 2014, Top Energy is in the process of expanding the current 53 MW capacity of the Ngawha power station in Northland by 28 MW. A significant factor in recent geothermal projects has been the high level of commercial participation by Māori-owned enterprises.

Geothermal energy for electricity generation

The main use of geothermal energy in New Zealand is for electricity generation.

In 2017, electricity generation from geothermal accounted for over 17% of New Zealand's total electricity supply.

Geothermal is currently one of New Zealand’s cheapest sources of new electricity generation.

Most of New Zealand's installed geothermal generation (about 1005 MW) is situated in the Taupo Volcanic Zone, with a small amount in Ngawha in Northland. As of July 2018, there was about another 350MW of consented geothermal generation. The temperature and conditions of particular geothermal reservoirs determine which type of generation technology is used: dry steam, flash steam, binary cycle, or a combination.

Geothermal energy for direct use

There is a wide range of direct uses of geothermal energy in New Zealand, which involves using geothermal heat directly, without a heat pump or power plant.

Currently there is about 8 PJ per year in direct geothermal heat use applications. Approximately 65% of this is used in industrial applications, 25% in commercial, and the remainder in residential and agricultural applications.

Kawerau, where geothermal steam is a significant source of energy for pulp and paper mills, was until recently, the world’s largest direct geothermal heat use at a single location.

Other existing applications include:

a. Timber drying – Tenon’s wood processing plant near Taupō uses geothermal energy to heat its timber-drying kilns.

b. Aquaculture/tourism – The Huka Prawn Park, near Taupō, is the only geothermally-heated prawn farm in the world. Heated discharge water from the Wairakei geothermal power station helps heat the ponds.

c. Horticulture – The use of geothermal energy to heat the glasshouses of Rotorua-based PlentyFlora and Taupō-based Gourmet Mokai has reduced production costs for flowers (PlentyFlora) and tomatoes/capsicums (Gourmet Mokai).

d. Milk drying – The Māori-owned dairy company Miraka, based near Taupō, is the first milk drying facility in the world to use geothermal energy.

e. Space heating – Rotorua Hospital uses geothermal energy – via a heat exchanger – for space heating and hot water heating. The system, commissioned in 1977, has proven to be a very reliable source of energy.

Changing geothermal technologies

In recent years an increasing range of geothermal technologies is becoming viable for commercial deployment globally.

For example, Australia has seen a rapid increase in companies developing engineered geothermal systems. In Germany and Scandinavia, ground source heat pumps are becoming more common.

This 2010 report on geothermal energy looks at:

  • emerging technologies relating to geothermal energy
  • barriers to greater use of geothermal energy.

Report on Geothermal Energy, Emerging Technologies and Barriers to Geothermal Development [PDF, 187 KB] 

Related content

Below is further information about geothermal energy in New Zealand, including contact details for organisations involved in geothermal energy use.

Geothermal(external link) — Energy Efficiency and Conservation Authority

EECA is a New Zealand government agency that works to remove barriers to, and encourage the uptake of, all renewable energy technologies. EECA works with, and supports, the New Zealand Geothermal Association to undertake industry-led initiatives to support the use of geothermal energy.

New Zealand Geothermal Association(external link)

NZGA is a non-political, non-governmental and non-profit organisation. Its objective is to encourage, facilitate and, when appropriate, promote co-ordination of activities related to New Zealand and worldwide research, development and application of geothermal resources.

GNS Science(external link)

GNS is a New Zealand crown research institute that focuses on geological resources, environmental and industrial isotopes, and geological hazards.

Institute of Earth Science and Engineering (IESE)

IESE is a joint venture between the University of Auckland and Auckland UniServices Ltd. Based at The University of Auckland, IESE builds on existing multi-dimensional research strengths across the University and engages in commercial research and consults on a broad range of topics.

Contact Energy(external link)

Contact Energy is a New Zealand energy generator and retailer with a significant amount of geothermal generation.

Mercury(external link)

Mercury is a New Zealand energy generator and retailer with a significant amount of geothermal generation.

Top Energy(external link)

Top Energy is a New Zealand electricity generator and lines network company that owns the Ngawha geothermal power station.

Nova Energy(external link)

Nova Energy is a New Zealand energy generator and retailer that owns the Kawerau geothermal power station.

Tuaropaki Trust(external link)

The Tuaropaki Trust is a trust made up of several hapū that with Mercury own the Mokai geothermal power station.

Tauhara North No. 2 Trust(external link)

The Tauhara North No 2 Trust is a trust made up of several hapū that with Mercury own the Rotokawa and Nga Awa Purua geothermal power stations.

Last updated: 09 August 2023