At a glance
Ruapehu District Council welcomed plans on 28 October 2026 for a data centre campus and a wood pellet plant at the former Winstone Pulp International mill at Karioi.
Data Igloo, a New Zealand cold data storage company registered in January 2025, is the company behind the campus.
Te Ara Hiko plans a biocoal plant on the same site that would turn 500,000 tonnes of pine logs and residues a year into 180,000 tonnes of fuel.
Two Transpower transformers at the substation next to the site, 120 MVA in total, have supplied no load since the mill closed in 2024.
RNZ reported the combined development at $300 million, and said Ruapehu Mayor Weston Kirton put the jobs at 60 to 100.
Ruapehu Mayor Weston Kirton welcomed proposals on 28 October 2026 for a data centre campus and a biofuel plant at Karioi. The site is the former Winstone Pulp International (WPI) mill, about 8 kilometres west of Waiouru. The mill closed in 2024 after a rise in wholesale electricity prices.
"Bringing productive activity back to Karioi is welcome news that could help rebuild confidence, create much-needed jobs and generate work for local suppliers, contractors and other businesses," Kirton said in the council's release. Both developments are still at the planning stage.
The site comes with a grid connection already built: Transpower's two transformers at Tangiwai, 120 MVA in total, have supplied no load since the mill closed.
Data Igloo plans a cold storage campus at the mill
Data Igloo would run a campus for "secure, energy-efficient storage, compute colocation and sovereign data storage and processing", the council's release says. Its design separates low-energy storage from intensive processing and uses the region's cool climate to cut cooling and energy needs.
Cold storage holds data that is rarely read, such as backups, archives and old training data, on drives that mostly sit idle. Data Igloo calls cold data storage its first focus.
Data Igloo was registered on 24 January 2025. Its pitch is to take rarely read data off servers in the United States and Europe: "We help customers and channel partners move the cold half of their storage estate to New Zealand, so racks, power and cooling in the United States and Europe can go back to AI, production systems and anything that genuinely needs low latency," according to its website. It describes a first campus of several exabytes in regional New Zealand, serving the US, Europe, Asia-Pacific and New Zealand through storage that works with the S3 interface used by Amazon's cloud, and calls that infrastructure "under development".
RNZ reported the two projects together as a $300 million development. Kirton put the jobs at 60 to 100, RNZ said.
Te Ara Hiko wants the same site for a biocoal plant
Te Ara Hiko, the second developer, plans a "180,000tpa Biocoal manufacturing facility on the Winstone Pulp Mill site at Tangiwai, consuming around 500,000tpa of Radiata pine pulp logs and biomass residues", according to its evidence to Horizons Regional Council. Biocoal is wood heated without oxygen until it burns more like coal. Te Ara Hiko expects the plant to abate around 400,000 tonnes of carbon dioxide a year. Its evidence lists the adjacent Transpower substation and the rail siding among the site's benefits.
Horizons heard the wastewater discharge consent the pellet plant needs on 14 and 15 October. Fifteen of the 20 submissions supported it, the NZ Herald reported. In the council's account, Ngāti Rangi opposed that application in its current form because of proposed wastewater condensate discharges into the Whangaehu River. "Restoring employment and economic activity is important, but so is protecting our environment and the health of the awa," Kirton said, using the te reo word for river.
Power prices closed the mill in 2024
WPI ran the Karioi mill from 1978. "The Site closed in the winter of 2024 due to the exceptional wholesale electricity spot prices experienced," chief executive Mike Ryan told the Horizons hearing. His evidence puts the mill's staff at approximately 150, and the Tangiwai sawmill's at a further 80 to 90. RNZ reported in August 2024 that WPI's energy prices had risen from $100 a megawatt-hour in September 2021 to $500 in August 2024.
WPI acknowledges the site will not go to a buyer who would restart pulping.
Transpower keeps the mill's grid connection ready for new users
"Following Winstone Pulp International's decision to indefinitely close its Tangiwai Sawmill and Karioi Pulpmill in 2024, no load is supplied by the Tangiwai 220/11 kV transformers," Transpower's 2025 Transmission Planning Report says. The two transformers provide "a total nominal installed capacity of 120 MVA". Transpower forecasts no load there through 2040. Its 2026 report adds: "We are keeping the 220/11 kV assets in service for now in case new customers want to connect." It also lists solar and battery projects to connect at Tangiwai.
For data centres, a large grid connection can take more than three years, by Transpower's account in our regional report. Transpower has had 30 approaches from data centres, and it says most loads under 40MW connect through the local lines company. New Zealand's colocation market runs about 208MW across 36 facilities on Arizton's June count, as our market survey sets out. The largest new plans run to hundreds of megawatts, such as Contact Energy and CDC's planned 250MW Stratford campus and Datagrid's 280MW Makarewa site.
We expect the 120 MVA Tangiwai connection to set the ceiling on Data Igloo's campus, because Transpower is keeping those transformers in service for new customers.
The site sits on the North Island Main Trunk railway, about 300 kilometres in a straight line from Auckland and about 210 kilometres from Wellington, by our calculation. Raglan, where the Tasman Global Access cable lands, is about 195 kilometres away. EonFibre co-owns Tasman Global Access.
What to watch
The pellet plant consent: WPI's reply to the Horizons hearing panel is due on 9 November, under the panel's Minute 4, and the NZ Herald reported that the panel's chair expects a decision before Christmas.
The campus plans: the council's release describes both developments as at the planning stage.
Tangiwai's grid: Transpower lists a possible thermal upgrade of the Bunnythorpe to Wairakei circuit through Tangiwai, with a need date of 2035.
Source: Ruapehu District Council (28 October 2026); RNZ (29 October 2026 and 20 August 2024); Data Igloo; Te Ara Hiko and Winstone Pulp International evidence to Horizons Regional Council (September 2026); Horizons Hearing Panel Minute 4 (16 October 2026); Transpower Transmission Planning Reports 2025 and 2026; NZ Herald (18 October 2026); NZ Companies Office.