The section between Palmerston North and Hamilton was electrified at 25 kV 50 Hz AC, opened on 24 June 1988 as one of the Muldoon National Government's "Think Big" energy development projects. An overall cost in excess of $100 million had been projected, with some 40% being for the locomotives, but the final cost was about $250 million. The economics of the project was greatly undermined by the fall of the price of oil in the 1980s and the deregulation of land transport, which removed the long-distance monopoly NZR held when the cost-benefit report was written.