TrustPower could eventually provide about a third of the needs of Canterbury irrigation heavyweight Central Plains Water.

The electricity firm has been buoyed by a new hearing for an up to $400 million plan to develop irrigation canals and power stations alongside the Rakaia River.

TrustPower commercial operations general manager Chris O'Hara said the generator was looking forward to a fresh hearing from July 23 on proposed amendments to the Rakaia River National Water Conservation Order to sort out water rights.

The changes would allow TrustPower to more economically use the water in Lake Coleridge and the Rakaia River, O'Hara said.

The company would not use the Lake Coleridge power station for generation in the winter months, instead saving the water for use for irrigation in the months from October onwards each year, if it is allowed to go ahead.

TrustPower plans to spend between $300m and $400m on a staged project starting in five to six years based on irrigation demand.

This would include a canal built over three years from Lake Coleridge on the northern side of the Rakaia River with four to six small power stations generating a total of between 50 and 70 megawatts of electricity.

The electricity could power from 20,000 to 25,000 households, according to one estimate.

The plan to increase irrigation and build new power stations at the expense of some winter generation would give TrustPower "a reasonable return on the investment", O'Hara said.

The July hearing, before commissioners Peter Salmon, Rau Kirikiri and Andrew Fenemor, would focus on hydrological evidence.

The new hearing dates are necessary because, Mike Bowden, one of the commissioners hearing the application, died. He has been replaced by Fenemor. Some of the material heard in the first section of the hearing will be used as part of the new hearing.

Environment Canterbury is overseeing the hearing and the commissioners will make a recommendation.

O'Hara said he expected a decision within a couple of months after the hearing and was "quietly confident" the canal and power station scheme would be approved.

O'Hara said TrustPower had already been in talks with potential customers, Barrhill Chertsey Irrigation (on the southern side of the Rakaia) and Central Plains Water (on the northern side), who were planning expanded irrigation.

CPL general manager Derek Crombie said TrustPower's scheme could provide about a third of Central Plains's river-based water needs in an average year.

CPL had consents for use of river water under higher flow conditions, but planned to use TrustPower water when river flows were lower.

CPL farmers had about 85,000 hectares of land of which about 60,000ha needed new or ongoing irrigation.

CPL had existing river and ground water rights but wanted to reduce its reliance on this water for environmental reasons.

Colin Glass, a member of the Rakaia River Irrigators Association executive committee, said the association had reached an agreement with TrustPower under which the rights of association members were not compromised by the TrustPower plan..

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