The government has lent $18 million to the Tukituki Water Security Project from the Regional Infrastructure Fund, turning a long-running Hawke’s Bay argument into something that looks increasingly like a live capital project. Combined with a $3 million grant announced in December 2024, the Crown has now committed $21 million to getting this dam to a final investment decision by 2028.
This is not a grant. It is a loan, meaning Treasury expects repayment and has made a commercial judgement that the project can stand on its own feet. For a region where the Heretaunga Plains deliver about 80% of GDP and face a projected freshwater shortfall of nearly 25 million cubic metres by 2040, the signal is clear: the coalition has decided water storage is infrastructure, not ideology.
The dam that refuses to die
The proposed 83-metre dam on the Makaroro River would create a reservoir of approximately 93 million cubic metres, irrigating 20,000 to 30,000 hectares of Central Hawke’s Bay farmland. The project’s roots go back more than a decade under its previous identity, the Ruataniwha Water Storage Scheme, which the Supreme Court killed in 2017 after ruling the Conservation Minister had acted unlawfully arranging a land swap involving 22 hectares of DOC land in the Ruahine Forest Park. The Regional Council walked away in 2018, having burned approximately $20 million in development costs.
Local farmers bought the intellectual property and consents, kept the project alive, and rebranded it. Now they have government money and a serious project leader. Mike Petersen, chair of the TWSP, told BayBuzz the project has recruited Mike Scott, the former CEO of Waimea Water who successfully delivered that dam from design through commissioning.
Fast Track is the whole game
The fundamental legal obstacle has not changed. What has changed is the government’s willingness to use the Fast-track Approvals Bill to override the consenting process that previously blocked it. The TWSP is listed on Schedule 2 of the bill, with a formal application planned for mid-2026 and a panel decision to follow.
The government is spending $18 million on engineering and design before the central legal question is resolved. That is a deliberate bet that Fast Track will deliver what the Supreme Court previously said could not be done under normal law. Given the political architecture, it is a reasonable bet. But it is still a bet.
The opposition is already splitting
Environmental group Wise Water Use HB has called the revived project “the same pig, but with lipstick on”. Spokesperson Dr Trevor Le Lievre has declared it “completely unworkable”. But here is the fracture that matters: the same group views a second proposed dam, the Heretaunga Water Storage Facility on the Ngāruroro River tributary, as “the lesser of two evils.”
That concession is significant. Once opponents accept that water storage infrastructure should be built somewhere, the argument shifts from principle to location. The unified “no dams” front is gone.
The TWSP’s Petersen has called the two projects “complementary”, and the Heretaunga feasibility study is expected to complete around Q3 2026. Whether the region can actually fund and absorb two major storage projects simultaneously is a different question entirely.
What $900 million looks like
A 2016 Regional Council report estimated construction at $333 million, with a further $556 million in farmer investment costs, taking the total beyond $900 million. Those figures are nearly a decade old and almost certainly understated in today’s construction environment. The project’s own backers cite three economic impact studies estimating $230-300 million in regional economic benefit and 2,000-3,000 jobs.
Karen Williams, chief executive of IrrigationNZ, frames the stakes plainly: “If freshwater is framed primarily as something to be constrained, that signal will cascade through the entire system.” She is right. The question is no longer whether Hawke’s Bay needs water storage. It is whether the political and legal machinery can deliver it before the next drought forces the conversation all over again.
The $6.8 million feasibility study now underway, co-funded by roughly 60 local businesses, will run through to 2027. The horticulture, viticulture, and farming sectors that depend on this region will not have certainty until at least 2028. Private capital at scale will need to follow public commitment. But for the first time in a decade, there is a credible path from argument to concrete.
Sources
- RNZ: Controversial Hawke’s Bay dam project gets $18m loan from government (2025-06-18)
- RNZ: Is a massive dam in Hawke’s Bay viable? Govt gives $3m grant to find out (2024-12-01)
- NZ Herald: Ruataniwha Dam successor – Tukituki Water Security Project to be assessed through Fast-track Approvals Bill
- NZ Herald: Whanawhana dam feasibility study begins for project in Heretaunga Plains
- NZ Herald: HBRC’s Heretaunga dam study a ‘complementary project’ to Central Hawke’s Bay dam, backers say
- Fast Track Approvals: Tukituki Water Security project listing
- Tukituki Water Security Project: Funding secured, feasibility assessments underway
- RNZ: Hawke’s Bay water storage project a step closer
- Farmers Weekly: Managing one of our greatest strengths – abundant water
- BayBuzz: Contentious dam hangs over CHB