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Cablegate: Doe and Gnz Officials Discuss Usg-Proposed Clean Island

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RR RUEHHM RUEHLN RUEHMA RUEHPB RUEHPOD
DE RUEHWL #0051/01 0502102
ZNR UUUUU ZZH
R 192102Z FEB 08
FM AMEMBASSY WELLINGTON
TO RUEHC/SECSTATE WASHDC 5069
INFO RUEHNZ/AMCONSUL AUCKLAND 1622
RUEHBY/AMEMBASSY CANBERRA 5104
RUEHDN/AMCONSUL SYDNEY 0641
RHHMUNA/CDR USPACOM HONOLULU HI
RHMFIUU/DEPT OF ENERGY WASHINGTON DC
RUEHZN/ENVIRONMENT SCIENCE AND TECHNOLOGY COLLECTIVE
RUEHRK/AMEMBASSY REYKJAVIK 0008
RUEHSM/AMEMBASSY STOCKHOLM 0084
RUEHLO/AMEMBASSY LONDON 0189
RUEHKO/AMEMBASSY TOKYO 0695
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RUEHBH/AMEMBASSY NASSAU 0001
RUEHWN/AMEMBASSY BRIDGETOWN 0011

UNCLAS SECTION 01 OF 03 WELLINGTON 000051

SIPDIS

SIPDIS
SENSITIVE

STATE FOR STATE FOR EAP/ANP
PACOM FOR J01E/J2/J233/J5/SJFHQ

E.O. 12958: N/A
TAGS: ENRG SENV PREL NZ
SUBJECT: DOE AND GNZ OFFICIALS DISCUSS USG-PROPOSED CLEAN ISLAND
INITIATIVE


WELLINGTON 00000051 001.2 OF 003


REFTEL: Wellington 48

1. (SBU) Summary. Following a visit to Antarctica, U.S.
Department of Energy DAS Steven Chalk met with a GNZ
inter-ministerial group chaired by the Ministry of Research, Science
and Technology (MORST) to discuss a proposed Clean Island
Initiative, which was first discussed during DOE A/S Andy Karsner's
visit to New Zealand in January 2008. GNZ officials welcomed the
proposal, and agreed to provide further comments to a draft DOE
concept paper shared with the New Zealand and Iceland governments.
Chalk and GNZ officials also agreed to meet on the margins of the
March WIREC meetings in Washington to further discuss the
initiative. NZ officials urged that Clean Island meetings be
scheduled to coincide with other major fora as it is often difficult
for GNZ officials to travel long distances for meetings. End
Summary.

Clean Island Initiative
-----------------------

2. (SBU) As a follow-up to DOE A/S Karsner's January 14-15 visit
to Wellington and Auckland (reftel), DOE DAS Steven Chalk visited
Wellington on February 12 and met with GNZ officials to further
review the DOE-proposed Clean Island international partnership. The
premise of the initiative is that island nations are particularly
vulnerable to the negative effects of climate change (e.g., sea
level rise and extreme weather) as well as energy price shocks
because many island nations are spending large sums for imported
fuels. Developing island countries, with relatively small
populations, can benefit from technology transfer of renewable
energy forms from developed island nations. Developed islands such
as Iceland, New Zealand, and the U.S. state of Hawaii have already
made a commitment to renewable energy use and have the potential to
export best practices to less developed countries. The purpose of
the international partnership proposed by DOE is to create an
information sharing nexus of island nations using renewable energy,
which will then be placed to assist other interested island
countries with lessons learned.

3. (SBU) DOE envisions bringing together policy experts, energy
and technical officials, as well as financial institutions for
regular meetings to further the use of renewable energies with a
goal of reaching 70 percent usage on these developed islands within
a single generation. Success will be defined and measured in a
number of ways; chief among them will be measurable adoption and
transition to renewables and higher energy efficiency.

4. (SBU) Initially, DOE foresees limiting participation within the
partnership to developed island nations that have made a significant
commitment to renewables, have invested in research and development,
and defined policy statements and strategies for achieving carbon
neutral status. Given that developed countries are still refining
their deployment of renewables and research/development efforts are
continuing, DOE believes that it would be premature to include
developing island nations at the outset of the partnership.

GNZ Officials React to the DOE Initiative
-----------------------------------------

5. (SBU) In an inter-ministerial meeting hosted for DAS Chalk by
MORST's Director for Environmental and Social Development, Eric
Pyle, Chalk briefed the group regarding the Major Economies meeting
that recently had taken place in Hawaii. The meetings had been
productive and the USG was encouraged that post-2012 goals would be
quantified in the near future, said the DOE official. Chalk offered
that the USG had worried some countries might wait out the current
Administration, but that had not been the case.

6. (SBU) The DOE recently signed an MOU with the Governor of
Hawaii that will lead to 70 percent renewable energy use within one
generation, said Chalk. The Hawaiian island of Lanai will be a test

WELLINGTON 00000051 002.2 OF 003


case, where DOE hopes to meet the 70 percent target in a few years
through a mixture of addressing institutional barriers, policy
changes, technical fixes, and private financing. Grid integration
will be a key element to large-scale renewable use and DOE will work
with utilities in Hawaii, he added.

7. (SBU) Chalk welcomed the opportunity to review the concept
paper for the Clean Island initiative that DOE A/S Karsner had
discussed with MORST CEO Helen Anderson during the former's
mid-January visit to New Zealand (reftel). He noted that the
document remains a draft concept paper, and DOE welcomes further
refinement from New Zealand. DOE would like to meet on the margins
of the March WIREC meetings in Washington to discuss the initiative
in greater detail in preparation for holding the first meeting in
Iceland in June. The goal would be to bring together technology,
policy, and financial officials for moving island nations to advance
clean energy deployment on a large scale. Chalk noted that DOE
would like to foster longer term public-private partnerships -
particularly in the area of financing biofuel development through
venture capitalist investment - and that government-backed loans may
play a role. A/S Karsner, emphasized Chalk, hopes that the
initiative will lead to executable plans for measurable results,
e.g., 70 percent use of renewables in one generation and where
appropriate, 100 percent use. In addition, reduction in demand and
increased energy efficiency are also important components. Chalk
said that Hawaii pays US 20 cents/kilowatt hour for electricity,
which is five times the US mainland price - renewables are therefore
competitive in terms of price.

8. (SBU) While some renewable energy sources, e.g., wind and
geothermal, are already deployed, more work is needed to improve
cellulosic biofuels, plug-in hybrid vehicles, wave/ocean power and
hydrogen, Chalk mentioned. As far as geothermal work is concerned,
the DOE official noted the strong synergy between New Zealand,
Iceland and the state of Hawaii. He pointed to the international
bank established by Iceland (with government backing) to finance
geothermal projects as an example of the type of policy approach
needed to advance use of renewables.

9. (SBU) GNZ officials responded positively to Chalk's remarks and
expressed strong willingness to collaborate on the Clean Island
Initiative. Roger Fairclough, Manager of Fuels and Crown Resources
at the Ministry of Economic Development, said that MED would be keen
to share paradigms and learn from other states' experiences. He
agreed that large-scale deployment of renewables is key to
transformational change for islands. Ministry of Transport
officials Simon King and Tony Frost also welcomed the initiative,
noting that the GNZ has targeted electric vehicles as part of New
Zealand's sustainability plan. Both noted that renewable energy use
for electricity generation in New Zealand is not problematic due to
NZ's plentiful natural resources; the transport sector - as in
Iceland - is the biggest challenge. Air New Zealand and Boeing are
reviewing use of biofuels for air transport, they said, to address
tourism concerns over the greenhouse gas emissions associated with
long-distance air travel. Transport officials urged that the Clean
Island Initiative focus on a systems approach towards the demand
side of transport needs within island communities. They also noted
that each participating country in the Clean Island Initiative will
have different resource endowments and different priorities and
strengths. New Zealand, for example, does not have a domestic
automobile manufacturing capability so has little relevant research
and development to share for that sector.

10. (SBU) GNS Geothermal Manager Colin Harvey and General Manager
of Research Robin Falconer noted that New Zealand has a heavy
research strategy focus on renewables, with geothermal work now
pushing into non-traditional areas, i.e., low-temperature heat.
Harvey offered that geothermal provides opportunities for small,
isolated communities, and that New Zealand had worked with United
Technologies from Alaska. Oceans and tidal energy will require
weather forecasting models, he added.

WELLINGTON 00000051 003.2 OF 003

11. (SBU) GNZ officials asked Chalk about the scale of renewable
deployment in Hawaii; Chalk estimated that it would require 5-10
gigawatts, noting moving to renewables not only entails replacing
power but also generating capacity as well. There are integration
and control limitations, but these engineering issues and not
scientific ones, he added.

12. (SBU) In discussing the format for future Clean Island
meetings, GNZ officials urged that the USG try to combine meetings
with other established fora likely to draw the same participants to
reduce additional travel. Roger Fairclough noted the growing number
of biofuel meetings and suggested that the Clean Island initiative
might coincide with the APEC experts group meetings. Chalk promised
to relay the contents of his meetings to A/S Karsner and rework the
draft concept paper accordingly for further discussion in Washington
during the March WIREC meetings.

13. (U) DAS Chalk cleared this message.

KEEGAN

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