Embargoed until delivery: 9.30am, Thursday 25 May 2000, Wellington Convention Centre Speech Notes

Address to the New Zealand Wind Energy Association Annual Conference

Thank you for the opportunity to address the New Zealand Wind Energy Association’s annual Conference.

I notice that delegates will be getting more than their fair share of wisdom from politicians today. Marian Hobbs will be speaking later on Resource Management Act issues and climate change policy, while Jeanette Fitzsimons will be concluding your conference with a presentation on her hard won Energy Efficiency and Conservation Act.

I see a large number of familiar faces in front of me. Some of you I’ve met before – possibly at last year’s conference where I spoke representing the Labour Opposition.

I congratulate the Wind Energy Association on the constructive role that it has played in the last few years. As the public face of an emerging industry the Association has held several high profile events to showcase wind energy and liaised with key interests.

In New Zealand we have one wind turbine in Wellington, seven in Martinborough and forty-eight at the Tararua Wind Farm in Palmerston North. Recently I have been particularly impressed by the Tararua Wind Farm development. It produces enough energy to supply 25,000 homes, is popular in the community and spent 30% of its development costs within New Zealand. I was therefore pleased to acknowledge the efforts of TrustPower and CentralPower at EECA’s ‘Energywise Awards’ in March. There I presented Tararua Wind Farm with the inaugrual ‘New Renewable Energy’ Award.

Most of you will be aware that New Zealand has one of the best wind resources in the world. Yet recently only one resource consent has been applied for. The barriers to greater uptake of wind energy are many. They include structural issues to do with electricity reform, pricing and the Resource Management Act. As I have told the Wind Association, there are no magic solutions to these issues but there are a number of ways we can work, together, to address them.

One topic that I know is of great interest to you is the Electricity Inquiry. The Association made both written and oral submissions to the Inquiry – with emphasis on fixed or variable transmission charges. Fixed charges disadvantage embedded generation and wind energy projects are generally embedded. The Terms of Reference for the Inquiry explicitly refer to fixed charges, both for distribution companies and Transpower.

The submission also raised the issue of the threshold on lines companies owing electricity generation under the Electricity Industry Reform Act. This disadvantages new renewables.

I understand other submitters also raised similar issues and I am sure the Inquiry team will take these points on board.

The Inquiry held hearings around the country in late March/early April. It is now into its deliberation phase and will report to me by 12 June.

I am very keen for the Government to resolve these issues as quickly as possible.

I hope that we can keep new legislation on this industry at a minimum. However, any necessary new legislation will be introduced later this year.

Wind Energy, and new renewables, must be seen in the context of climate change. The recent announcement from the Prime Minister to ratify the Kyoto accord by 2002 clearly demonstrates a political will to tackle this issue, which frankly has been missing until now. The Government is currently exploring the policy options, but the size of the challenge is significant and raises issues for every sector of the economy. Over the next 18 months the papers, the policies and the various actions will come rolling out. I am the coordinating Minister for this large body of work. It's exciting, it's hard and it's quite big.

I want the Wind Energy Association to weigh into the debate with a clear focus on solutions and the respective roles of government and the industry.

Most of you will have heard of the Energy Efficiency and Conservation Act that has just been passed. It establishes the Energy Efficiency and Conservation Authority, EECA, as a stand-alone Crown entity. Even more importantly it creates a statutory requirement to promote energy efficiency, energy conservation and the use of renewable energy in New Zealand. The main mechanism for doing so will be the preparation of a National Energy Efficiency and Conservation Strategy by 1 April 2001.

I want to pay a tribute to Jeanette Fitzsimons for her commitment to this piece of legislation. She had to clear many hurdles, anyone of which could have stopped her in her tracks. She hit the tape a couple of Wednesdays ago.

I am pleased that EECA will now have a statutory role within the state sector. Its two years of perpetual review under the previous government has come to a close. It can now proceed unhindered to make an important contribution to the climate change issues facing the new government.

The ultimate responsibility for preparing the strategy rests with me, and I am happy to assume that responsibility. The strategy will form a key part of this Government’s energy policy. For this reason it is crucial that you all take a full participatory role in helping its bottom-up development.

Also the taxation review will be an important forum in which to raise arguments in relation to a carbon charge. The Government has no plans to levy such a charge this term. We will instead take the decision to the electorate in 2002. But the review, covering all taxation, is in the work programme for this term.

So there it is, an electricity inquiry, a new Energy Efficiency and Conservation Act, new action on climate change including a ratification date and a taxation review.

It would seem that the interaction between the Wind Energy Association and the Government just got deeper, and if I stop now and the Chair says questions are allowed, then the interaction can continue forthwith.

ENDS

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