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Woods looks to new energy bill and RMA reform

Woods looks to new energy bill and RMA reform

First published in Energy and Environment on July 18, 2019.

The Government is considering the introduction of a “renewable and affordable energy Bill” in response to the Electricity Price Review.

Cabinet papers released in the wake of the ICCC reports outline work on the Bill and other issues.

Energy and Resources Minister Megan Woods told Cabinet she would be shortly bringing a recommended response to the Electricity Price Review.

“Many of its recommendations address the need for electricity prices to be fair and affordable, not just efficient or competitive.”

The options will look at how to improve the affordability and fairness of electricity prices and what regulatory changes are required to enable the electricity system to capitalise on the opportunity emerging energy technologies create.

“These options, along with those we agree to accelerate the deployment of renewable electricity generation and encourage the uptake of renewable energy in industry energy use will form the basis of a renewable and affordable energy Bill,” Woods said.

Work was underway to look at options to accelerate the deployment of renewable electricity generation to achieve the goal of 100% renewable electricity by 2035.

This work included identifying the barriers and developing policy options to reduce these barriers and accelerate the deployment of renewable electricity generation.

The barriers identified in the papers are:

• consenting barriers for renewable sites and their transmission connections

• transmission access barriers, particularly in areas where multiple renewable investors require connection

• lack of incentives to accelerate renewable electricity generation investment, and

• lack of affordable technologies for dry year and winter cover.

“A pressing issue is addressing the consenting barriers to renewable generation and their transmission connections, and transmission access barriers.” Woods said she would also produce a package of policies and programmes to reduce greenhouse gas emissions associated with industrial energy use and process heat.

This package is investigating a range of actions including:

• improving the energy productivity of industrial sites,

• encouraging fuel switching to renewable energy sources (e.g. electrification or biofuels) and the adoption of low emission technologies and processes, and

• facilitating state sector leadership in reducing process heat emissions

“Later this year, I will seek Cabinet approval to release papers with policy options to accelerate the deployment of renewable electricity generation, improve security of supply in a highly renewable system, and to encourage the uptake of renewable energy in industry energy use.”

On the issues of pumped hydro storage to meet dry year, intermittency and peak capacity requirements. “My view is that while some of these schemes may be technically feasible, it is by no means clear that they would be undertaken… given the high cost of pumped storage, generators in a market system will not be able to build any of these schemes without significant government support.”

Such a scheme would also involve significant trade-offs with environmental goals, as they would require the flooding of large volumes of land. “Given that these proposals would have freshwater implications such as mixing of waters or diversion from natural flow, attention would also need to be paid to the commitments within Te Tiriti o Waitangi, settlement legislation, and other forms of statutory obligation or non-statutory agreements with iwi/Māori relating to freshwater management.”

Woods said she agreed with the ICCC there is currently an “unhelpful ambiguity” within the National Policy Statement on Freshwater Management (NPSFM) as it is unclear whether hydro generation will be allowed to have freshwater objectives set below national bottom lines for water quality.

“I understand MfE will be consulting on an option to resolve this ambiguity in relation to the NPSFM as part of the larger freshwater consultation later this year.”

MBIE has also been examining issues relating to renewable generation development and the RMA, including examining the performance of the National Policy Statement for Renewable Electricity Generation, and considering whether to undertake development of a National Environmental Standard on renewable electricity generation.

“Officials will identify workable policy options to revise the NPSREG to be more directive, and also will consider the development of National Environmental Standards on renewable electricity.”
First published in Energy and Environment on July 18, 2019.

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