Contact and CDC – which is half-owned by Infratil – would seek resource consent for a 250 megawatt data centre to be built near the site of Contact’s Taranaki Combined Cycle gas power plant, which was retired earlier this year.
The data centre would be supported by a battery storage development, Contact said.
A Fitch survey released earlier last month said all of New Zealand’s data centres today consume 172MW, with a further 89MW was under construction.
The yet-to-be-fully-funded Datagrid “AI factory” proposed for Southland has an initial 280MW design, which could increase to 1GW. Mercury Energy paid $53m for a 12.7% stake in Datagrid, which will be used for initial earthworks while Datagrid continues its bid to find billions to build the data centre proper.
The generator-retailer said its improved operating result was driven by a significant lift in renewable output, up 2.9 terawatt hours (TWh) including power purchase agreements (PPAs).
This reflected the addition of the Manawa hydro assets and its contracted PPAs (wind and geothermal), which together contributed 2.4 TWh, with a full period of generation at Contact’s new Te Huka 3 geothermal plant.
Higher renewable output supported increased contracted sales.
With national hydro inflows in 2026 at 118% of mean, and New Zealand’s hydro storage ending the period 135% of mean, market conditions contrasted sharply with those of 2025, which included the lean winter 2024 period.
Average pricing on electricity sold was lower at $140/MWh, down 11% from $157/MWh in FY25, reflecting the normalisation of market conditions from a challenging 2025, it said.
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CFD (contract for difference) sales were at lower prices,
Contact spent less on gas purchases and acquired generation, costs of which were more expensive in 2025 when fuel was scarce.
“The 2026 financial year has been transformational for Contact, with the completion of the Manawa acquisition and the welcoming of its people and assets,” chief executive Mike Fuge said.
“The strong performance of the combined entity has set us up well as we move forward to execute the Contact31+ strategy.”
Among other things, Contact31+ involves expanding Contact’s leadership in geothermal generation.
In August 2025, Contact entered into a 10-year agreement with Genesis for 50MW of Huntly Firming Options (HFOs), mirroring Genesis’ agreements reached in parallel with Meridian and Mercury.
“Collectively the agreements help keep Huntly’s Rankine units operational in the event of future supply constraints in a dry year,” Contact said.
Contact declared a final dividend of 24 cents per share, taking the annual dividend declared to 40c.
Jamie Gray is an Auckland-based journalist, covering the financial markets, the primary sector and energy. He joined the Herald in 2011.
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