MEDIA STATEMENT

Wednesday, 15 December 2010

New Zealand Energy Outlook 2010 released

The Ministry of Economic Development today released the 2010 edition of New Zealand Energy Outlook.

The New Zealand Energy Outlook presents long-term forecasts of energy supply, demand, prices and energy sector greenhouse gas emissions.

This edition updates the Reference Scenario and sensitivity analysis published in September 2009.

The Reference Scenario assumes ‘business-as-usual’ in terms of broad economic drivers, policy settings, and technology and fuel choices. Sensitivity analysis considers the expected effect from changes to the key macroeconomic variables of economic growth (GDP), the exchange rate, emissions pricing and the price of oil.

Key highlights of the Reference Scenario include;
• Consumer energy demand is projected to grow at 0.9 percent per annum to 2030, lower than the 1.4 percent per annum seen since 1990.
• New Zealand’s energy intensity improves 22 percent by 2030.
• By 2030, renewable energy sources provide 50 percent of New Zealand’s energy supply.
• Total energy sector emissions stabilise but remain more than 40 percent above 1990 levels in 2030.
• Emissions from transport continue to grow while emissions from electricity decline.
• Wholesale electricity prices may need to rise 29 percent by 2030 in order to support investment in new generation.
Looking at the impact of changes in key drivers:
• Higher economic growth increases New Zealand’s energy consumption but also triggers greater energy intensity improvements. Energy intensity improves 29 percent by 2030 in the high economic growth sensitivity case.
• Emissions in 2030 are over 50 percent higher than 1990 levels in the high economic growth sensitivity case.
• Sustained higher oil prices encourage the purchase of more fuel-efficient vehicles and a greater uptake of electric vehicles and locally produced biofuels.
• An emissions price of $100 per tonne results in only limited additional emissions reductions compared with the Reference Scenario.
• A higher valued New Zealand dollar improves the economics of imported technology, such as wind turbines, and results in lower wholesale electricity prices.

ENDS

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