Business leaders say the set of energy market reforms proposed by the Government today contains a number of positive elements, but that ultimately it does not go far enough to address energy sector challenges or deliver the bold action that is desperately needed.

The Government today released its response to a major review of the performance of the energy sector by international consultancy Frontier Economics.

Auckland Business Chamber CEO Simon Bridges says that, by and large, the measures put forward are sensible and logical, and reflect feedback from sector stakeholders over recent months.

“But the problem is not what is included in the announcement, it’s what’s been left out. On their own, these measures aren’t enough to address the root causes of unaffordable energy prices and tenuous supply, and any benefits they deliver to energy users will be a long way off.

“Kiwi businesses and households have been crying out for bold action – today, they didn’t get it.”

Mr Bridges says that, more than anything, what’s missing is a willingness on the Government’s part to step in to address what is a broken market.

That could take the form, for instance, of underwriting back-up energy supply (for periods when wind and solar energy can’t generated) and/or by separating the generation and retail functions of the four gentailers.

“Without these sorts of measures, energy is going to continue being a handbrake on New Zealand’s economic prospects into the future.

“Ultimately, this was a missed opportunity to transform the contribution that energy can make to our country, and to demonstrate the Government’s commitment to growth and productivity.”

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