Electricity generators are embarking on a green Think Big solution to looming power supply shortages.

Fuel supply for most of the rest of this decade is secure but there are concerns beyond then when existing power stations may not have access to fuel.

Sparked by the Government's green push, the pace for alternative, sustainable fuel sources is picking up.

The Government's energy strategy says state-owned electricity generators should not build more fossil fuel-burning power stations. It is considering extending the ban to private sector generators as well.

With new hydro opportunities all but gone, generators are looking underground at geothermal energy and, most significantly, at wind to meet shortages next decade.

A dozen wind power projects generating close to 2700MW at full capacity are on the drawing board or have planning approval. The first of the big ones is not due for completion until early next decade, if it is not held up by objectors concerned about the visual impact and noise pollution.

New geothermal projects or major modifications to existing plants will generate more than 600MW. The Clyde Dam, one of the centrepieces of the late 1970s and early 1980s Think Big energy projects, generates 432MW.

But just as there are high costs and climate constraints with hydro power, so there are with wind.

The worldwide shortage of wind turbines is driving up price and generators are looking outside traditional suppliers in Denmark and Germany to other manufacturers in China and India.

Contact Energy plans to build the country's biggest wind farm near Port Waikato but its budget has a wide variable of between $1.5 billion and $2 billion. Infratil, which has a majority stake in TrustPower, has analysed the cost of windpower and found that in the past two years the sharp rise in the demand for turbines and increases in commodities such as copper, steel and cement, have led to a 15 per cent rise. Once turbine supply catches up with demand, costs should revert to 2004 levels.

The other problem lies with the vital component - wind. Although New Zealand's location in the Roaring Forties gives the country a natural advantage, wind does not blow steadily at all times, and wind farms usually run well short of full capacity.

New Zealand's biggest wind farm, TrustPower's Tararua project, has averaged slightly more than New Zealand's average of 45 per cent of full capacity - that is, what a wind farm would deliver if the wind blew all day every day at the right speed.

Energy Efficiency and Conservation Authority figures show an average wind turbine in New Zealand will produce electricity equivalent to it operating for 4000 hours at maximum output a year. In Wales, Scotland or Western Ireland the figure is typically around 3000 hours, or in Germany, only around 2000 hours.

Three big wind projects are planned for Otago and this is forcing national grid operator Transpower to focus even harder on plans for a $600 million plus line upgrade to get power north.

The upgrade is designed to boost the main transmission line between Benmore and Wellington and details of the plan will be released at the end of the month.

PICKING UP SPEED

* At the end of last year wind turbines generated 170.8MW - enough to power the requirements of around 77,000 typical households.

* More than 151MW of new capacity has been installed this year, nearly doubling the total capacity to 321MW.