Meridian Energy says conditions are right for developing a new wind farm, but it's considering its next move carefully.
Chief executive Mark Binns says the company has a number of possible generation projects in the pipeline, but it is particularly focussing on two potential windfarms.
The first is Central Wind - a 120 megawatt, 52 turbine wind farm in the central North Island - and the second is Mill Creek - a 60 megawatt, 26 turbine windfarm north of Wellington, close to its West Wind farm at Makara.
Mr Binns says Meridian's investment committee will closely analyse one of the projects this year.
He says the main manufacturers are in Europe and the euro is depressed which works in Meridian's favour.
But Mr Binns says the manufacturers are aware of this and they are looking to lift their prices in euros.
"There's an element of negotiation in it, but it's most certainly a far better environment than one where you see a weak New Zealand dollar and a strong euro", he says.
Meridian is one of four State energy companies the Government's earmarked for partial privatisation.
Mr Binns says regardless of when that happens, he thinks the company's balance sheet can handle more investment, without affecting its investment grade credit rating.
The company reported an underlying profit of $98.9 million in the final six months of 2011, 20% less than in the same period a year earlier.
Meridian lost generation capacity when it sold its Tekapo hydro stations to Genesis, as part of a Government-driven asset swap.
It was also affected by low hydro-lake intakes, transmission outages because of Transpower's upgrade of the HVDC cable linking the North and South Islands, and intense competition for retail customers.
Mr Binns says that while he expects business conditions to remain subdued for a while, they won't last forever and growth is expected to average 1.4% until about 2021.