Meridian Energy is looking at building a windfarm near a protected hill range in Wairarapa known as Nga Waka a Kupe (Kupe's canoes).
It's understood about 45 turbines could be built at the site, seven kilometres south-east of Martinborough.
Meridian spokesman Alan Seay says the state-owned electricity generator has had measuring equipment at the site for about a year which has confirmed there is a good wind resource in the area.
The site has the potential to provide power for up to 40,000 homes, he says.
The company has started consulting key locals and iwi who are concerned because the range is significant for local Maori.
Iwi representative Haami Te Whaiti fears the site's too close to the upturned canoe landform that is so significant to Maori. The legend associated with the site is that of Kupe and one of his companions competing to see who could build a waka in the fastest time, he says.
Mr Te Whaiti says the iwi has asked Meridian to check the potential for expanding another existing windfarm site away from the Nga Waka range.
Opponents say a windfarm so close to town could threaten tourism and the wine industry.
Roger Parkinson of Nga Waka Vineyard says the hills and their legend are important for the town and its wine. A windfarm on the site would be the equivalent of a McDonald's on Mt Rushmore, he says.
