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Back to the Future

15 December 2006

Back to the Future

The Canterbury Manufacturers’ Association welcomes the Government’s draft Energy Strategy and Energy Efficiency and Conservation Strategy reports as a step in the right direction in coordinating New Zealand’s disparate electricity system. However the recommendations contained in these documents will not redress the ongoing problem of price increases and inadequate supply and distribution of electricity.

“The focus on renewable energy and energy saving is generally the correct approach for the Government to take”, says Chief Executive John Walley. “However, the CMA’s each year view is that New Zealand’s energy demand is growing at 2.3% net of savings (almost double that in the National Energy Strategy which means the problem is much more immediate than 1.3% growth would suggest). Unfortunately, calling on consumers to use less electricity will not stem the increasing demand for electricity. All of New Zealand’s available hydro and geothermal resources need to be exploited to support the real level of growth which inevitably mirrors our increasing population”.

Mr. Walley says that more hydro and geothermal development is necessary to enable more wind generation and bridge the gap before marine generators and alternate fuel sources can be put in place. “Wind is complimentary to hydro and geothermal generation, rather than a one for one replacement. We all know the wind doesn’t always blow and there are questions as to its load factor, so the more wind, the more other generation is needed to provide the back up. Wind generation is not a solution of itself”.

Mr. Walley says that if these energy strategies can be consolidated and implemented correctly, then New Zealand can rebuild its reserve capacity using a mix of hydro, geothermal and wind over the next 10 to 15 years. After that tidal and marine sources are there to be exploited. Further out into the future, nuclear (fission certainly and perhaps fusion) becomes the carbonless solution. Nuclear power should not be eliminated. It is better scheduled out for the next 25 or 30 years, by that time, the northern hemisphere will have developed the technology as an acceptable solution to all but the greenest of the green.

“An electricity first, transport fuels next approach needs solutions with cost in mind and political point scoring on a ‘low carbon aspiration’ needs to make way for pragmatic carbon policies. Methane is a much more effective greenhouse gas than carbon dioxide and any credible low carbon policy must address all carbon emissions across all sectors of the economy, not just a select few. Anything less is political grandstanding, warming the hearts of politicians that might, in the end be more important than warming the planet”.

“In aspiring to a clean, green future, the Government needs to consider that in 1971 renewable resources made up over 75% of New Zealand’s electricity generation but by 2005 that figure had fallen to around 53%. It should also consider that by 2030, New Zealand’s electricity usage will have increased by 77% based the CMA’s estimated growth rate of 2.3%, required to restore reserve capacity, retire old plant and sustain the growth in demand” says Mr. Walley.

“Assuming that net load factors remain unchanged to achieve the renewable ratio in electricity generation we had in 1971, taking growth at even 1%, we have to double the total capacity of the all our existing renewable generation. If growth is closer to 2.3% we will need to than and as much again. This highlights just how big this task really is”.

“Low carbon, comparatively low electricity prices and secure supply aspiration drive New Zealand towards urgent development of large hydro and geothermal plants, a robust north-south 400kv transmission backbone, backed by wind, bio-diesel and later marine and nuclear sources.”

“Maybe then we can get back to what we had in 1971 - a 75% renewable content in electricity generation, a secure supply of electricity at some of the lowest prices in the world”.

ENDS

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