Minister for the Environment Amy Adams has blocked Pioneer Generation's plans for a hydro dam on the river, by changing the water conservation order on the Nevis to increase its protection.
That change would ban damming or diversion of the river, Ms Adams announced the decision on Friday, ending seven years of wrangling and legal action over whether the potential for hydro development on the river should be left open.
Pioneer development and delivery general manager Peter Mulvihill said the company's predecessor first mooted plans for hydro development on the Nevis in the late 1960s.
Pioneer is a community-owned company, which evolved from the Otago Central Electric Power Board after the restructuring of the power industry in the late 1990s.
The company would continue to pursue other renewable energy projects throughout the country, Mr Mulvihill said.
''We'll see what other opportunities there are, including wind farm prospects.
''Water conservation order processes are a minefield for any business involved in them,'' he said.
''The litigation costs are huge and the ground rules appear to keep changing throughout the process. Arguing the boundaries of things such as outstanding landscapes and concepts such as 'wild' is very subjective.''
Pioneer owns the leases of two farms on the banks of the Nevis, Ben Nevis and Craig Roy Stations, and both properties are in the tenure-review process. The properties provide access to suitable land and development sites for power schemes on the Nevis. The fate of those two farm properties was unknown at this stage, Mr Mulvihill said.
Pioneer believed its proposed dam was viable, with ''minimal environmental impact''. The existing water conservation order had kept the option open for damming or diverting the river, but the New Zealand and Otago Fish and Game Councils sought the change to rule out that option.
The recent Environment Court decision on the matter was split on damming but did not consider the trout fishery should be described as ''outstanding'' or that the dam would impact on the Nevis galaxiid fish, Mr Mulvihill said. When announcing her decision, Ms Adams said it was important to protect the galaxiid and trout fisheries and the wild and scenic characteristics of the river, especially for fishing and kayaking.
It was a difficult decision, but the benefits of banning future damming were ''more compelling'' and of greater national benefit than the benefits from preserving the option to dam the river, she said. A dam on the Nevis would have ''major negative effects'' on its wild and scenic qualities and on fishing and kayaking. Ms Adams was familiar with the area and appreciated it was a ''unique'' part of the country
A water conservation order was a very high level of protection and ''not something that most water bodies will qualify for, and that's as it should be'', she said.
