Energy Minister’s recipe for economic disaster

The government’s call to scrap the New Zealand Energy Strategy is yet another instance of the environment being sacrificed on the altar of exponential growth, and is a recipe for economic disaster.

However, there may be a tiny silver lining. At least this time the Energy Minister has not hidden behind the farce of “balance” and has had the courage to state the government’s true intent to sacrifice everything for unlimited growth!

Nevertheless, he fails to grasp that ignoring climate change in any energy strategy has costs and consequences far beyond his time in government. Without sound environmental protection, there can be no economy. The economy is a wholly owned subsidiary of the environment.

New Zealand is so well placed to make the transition to a truly sustainable energy supply, but just like the repeals of the renewable preference and the biofuel legislation, this announcement is another big step in the wrong direction.

The assault on Labour’s already weak environmental policy continues. With this latest announcement, we can expect our dependence on foreign fossil fuels like oil, coal and soon natural gas to grow exponentially as well. With our weak dollar and spiralling current account deficits, this is a recipe for economic disaster. The more we rely on imports, the more our security of supply will erode.

The Minister continues to fiddle while Rome burns. This strategy rebranding exercise will waste countless hours of ministry time better spent implementing the limited sustainable solutions already in the strategy. What we need now is action, not further dissembling.

To mis-quote Obama who was quoting someone else last month; Mr Brownlee will be remembered for what he builds, not what he tears down.

16 Comments Posted

  1. I understand the Environment Court hearing for the Crest tidal project is set down for June.

    Rural postie has just been and no decision yet on the Genesis gas-fired proposal. If you’re interested in whether a new gas-fired plant would ensure security of electricity supply, there are submissions to the Electricity Commission saying it won’t (lodged last week by Vector, Transpower and major electricity generators)

    Interestingly Genesis did not put in a submission despite the Electricity Commission specifically asking whether the Rodney gas-fired plant should be considered as an alternative to upgrading transmission in Auckland. Maybe Genesis didn’t want to answer awkward questions about their future intentions, at the NAaN public conference this coming Monday?

  2. jarbury said: What happened to the plans for a tidal power generator at the mouth of the Kaipara?

    That one is in the Environment Court awaiting further expert evidence being filed by Crest Energy in support of it. Actually it might have been filed already – I think the deadline was about now.

  3. Thanks for posting the links Trevor.

    I’m guessing that if the application’s approved today, the Govt will trumpet the Rodney gas-fired plant as a way to reduce GHG emissions because Genesis will then be able to retire Huntly coal units (that was the line they used when e3p was commissioned).

    But in November 2008 Genesis said that they would only consider swapping coal for gas if it made “commercial sense” to do so.

    Which will cost more to burn then – coal or gas – even with a carbon charge added? Contact said this week that the average cost of gas (excl. transmission) had increased 24% between 2007 and 2008. Don’t expect to see Genesis retire any Huntly coal units anytime soon.

  4. A decision is due today on the proposed gas-fired baseload plant north of Auckland. If Genesis Energy gets the go-ahead from the local council, it’ll be interesting to see how the Govt responds.

  5. Trevor

    there is no requirement that I know of. If Transpower want to build something new they can go ahead. But if they want to then charge you and me for the cost, that’s when they have to get approval. I suspect that starts at $1.

    AFAIK the $1.5m is in the settlement they came to with the Commerce Commission to avoid price control and is around maintenance costs (but I couldn’t find it when I had a look on the ComCom site).

  6. If the minister were only fiddling (as in playing the fiddle) it wouldn’t be so bad. Unfortunately he is fiddling (as in ****ing things up).


  7. Don’t you mean “fiddle while Nome burns”
    An esikimo I met once said to me in spite of climate change , there’s no place like Nome

  8. I should add that it is concerning when the Minister has a basic factual error underlying part of his policy direction.

    He said “At the moment, individual grid upgrade projects costing more than $1.5 million must be approved by the Electricity Commission. ” And then implies this is wasteful and needs changing.

    This is so untrue it defies belief that it made it past the policy people. it can only have got there because someone told him it was so and the people advising him either didn’t know any better, did not want to point out the error or never got the chance to correct him. I suspect the latter.

  9. Frog

    that is true he said that, but forgive me for thinking it was a fairly half hearted admission.

    His actions in accepting it in secret and not revealing he had either received it or had reviewed it, and then was going to base policy on it, sort of betrayed that horror of self regulation.

    And you are dead right in your assessment – it doesn’t in any way examine how these changes would improve governance – it just says it will. Weirdly the model that it suggests involves even more players in the regulation of the market which surely will create greater conflict and less oversight. But that was probably the aim…

  10. insider – In fairness to Gerry – god forbid – he did say in his speech that he thought self regulation of the industry was a horrible idea and that he did not support it. Whether that assuages your scepticism of crony capitalism or not is for you to judge. It doesn’t assuage mine, but then I’m just an ideological something-or-other if BP is to be believed. 🙂

    It still begs the question – If you do away with the Electricity Commission, which the Business NZ report is clearly designed to support, how do you effectively regulate the industry. Funnily enough, the suggestions in that report aren’t really there to answer that because they want to regulate themselves, as you said.

  11. I think you are missing the even bigger issue – the power industry has got together and in an almost cartel like manner completely captured his agenda. Gerry’s now shown he is their puppet. Do consumers think the industry has them at the top of its mind when making decisions?

    When thy released the recent report on governance of electricity Business NZ Chief Executive Phil O’Reilly said “a notable degree of consensus was achieved between the generators, Transpower and large electricity users during the report’s preparation.”

    SO the powercos paid for the report, were the main source of information for it, peer reviewed it and then behind the scenes sold it to the minister who is “very impressed by the report” and thinks it “a working document that may form the basis for recommendations on future regulatory and governance arrangements.”

    I’ll bet he does. Not sure if we as consumers are going to be quite so happy with governance of the industry by the industry and for the indsutry.

    I’m usually very sceptical of the Standard’s crony capitalist/policies for sale views but now I’m not so sure.

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