Mill owner: ‘Everyone’ is thinking of closing amid high energy costs

Tuesday, 30 September 2025

Timber mills are evaluating solar power amid soaring energy prices, but some say the numbers don’t add up.

Regional councillor Robert Cookson recently raised concerns during a regional council meeting about a sawmill in Tahuna, employing 16 people, which was facing the possibility of closure due to high energy prices.

“We’ve actually got a little sawmill in Tahuna, 16 employees,” Cookson said.

“They’re talking about shutting the doors as well because they can’t afford the energy price of running their sawmill [it’s] getting that high.”

David Waters, owner of Paneltek, in Tahuna, disputed the claim they were shutting down.

He confirmed the rising cost of energy was a challenge, with some months seeing price hikes of over 30%.

“There’s no surprises there, anyone in business has seen the electricity prices go through the roof,” Waters said.

“It’s certainly a massive increase in cost, but we’re not remotely thinking of closing.”

The pressure on the region’s mills is compounded by broader challenges in the industry.

OJI Fibre Solutions closed the country’s last paper-making machine at Kinleith in June, cutting 130 jobs, while Carter Holt Harvey announced this month the possible closure of its Tokoroa plywood plant.

Todd Bidois, managing director of NZ Timber which has a plant near Orini, echoed concerns about the high cost of energy.

“Are we concerned about energy prices? Absolutely,” Bidois said.

Their energy prices had increased by 22% in just the last 30 days.

Bidois said NZ TImber is a family-owned business that employs 52 people at its Orini mill.

While they weren’t planning to close, the rising energy costs were a heavy burden for smaller businesses.

“Everyone in hard times…has wondered whether or not there’s a better option or, or sort of pack it up and have a look,” Bidois said.

However, rising energy costs were not the only challenge.

“Pricing’s very low, and the export market’s in disarray with tariffs.”

“Nobody knows what our friend Trump’s going to do, so that puts a big sort of spanner in the works when it comes to us selling wood to China, because most of the product that is manufactured in China ends up in America.”

Then there were immigration policies changing frequently and training institutions closing too.

Bidois said they were 'definitely“ looking into solar power as something that might be able to help.

Waters said they had looked into solar too, but it wasn’t “cost effective”.

“For the capital cost it doesn't make sense.”

Cookson expressed concern about the broader forestry sector.

“Forestry is most probably one of our bigger employers in the region, and it’s getting its throat cut at the moment.”

“We’ve got to do better in that space. I think there needs to be a huge bit of investment into this timber industry.”

A regional economic development strategy has been identified as crucial for the region’s long-term prosperity.

Despite Waikato’s potential, its key metrics like GDP and industry productivity remain below national averages.

In 2024, Waikato’s median household income was 10% lower than the national average. The council has allocated $604,000 in funding for regional economic development for 2025/26 and 2026/27.

Tariq Ashraf, regional economic development lead, who has been leading the regional development efforts since July, acknowledged the region’s prosperity but stressed that more work is needed to improve productivity.

“We know that there is already a high level of prosperity in the region, but we can always do better,” Ashraf said.

“The biggest economic prosperity challenge has been productivity.”

While Ashraf highlighted the role of nature in supporting the region’s prosperity, other councillors called for more focus on economic growth.

Councillor Chris Hughes argued that protecting existing industries should be the region's top priority.

“Economic policy should be driving council policy. What’s good for the economy is good for everyone,” Hughes said.

Councillor Angela Strange advocated for diversifying the economy, suggesting that the council should focus on both traditional sectors like dairy and new growth areas.

Cookson, a third generation dairy farmer, agreed with the need to protect key industries while exploring other opportunities.

“We do want to add value to the economy, and if dairy isn’t the one, if there’s another land use that is more productive… then we’ve got to have the rules in place to allow that to happen,” Cookson said.

He also criticised the proposed rules in Plan Change 1, arguing that they could hinder efforts to diversify the region’s economy.

“If we’re going to have value add to the economy of using our land for vegetable production or whatever else, we’ve got to have the rules that we can make that apply and be able to have an environment that we can contain those nutrients to that land and not go down our waterway.”

“I think there’s a huge investment needed to look into doing that.”