Energy Strategy to 2050

5 May 2008

In October last year the Prime Minister Helen Clark and Energy Minister David Parker launched the New Zealand Energy Strategy to 2050. David Parker said the strategy sets out how “we will deliver secure energy at affordable prices to support economic development, while at the same time being environmentally responsible and reducing carbon emissions from our energy production and use.” He also reiterated the Government’s announcement the previous month as part of the Emissions Trading Scheme to generate 90 per cent of New Zealand’s electricity from renewable energy sources by 2025.

“The emissions trading scheme will help us achieve that. In addition, we’ll be considering regulatory options through the Electricity Act to limit new fossil-fuel base-load generation over the next ten years.

“We are also preparing a national policy statement on renewable energy to provide guidance to local authorities when they’re considering renewable energy projects.”

The energy strategy includes the target of halving domestic transport emissions per capita by 2040. The use of renewable energy from biofuels will increase, and New Zealand aims to be a world leader in electric vehicles.

EFNZ Workshop on energy strategy

In December, the Energy Federation of New Zealand (EFNZ) held a workshop to cover a range of responses from different sectors to the Government’s energy strategy. CRL Energy CEO and EFNZ Chairman, Dr Rob Whitney, summarised a major study undertaken by the World Energy Council (WEC) in which he had participated: “Deciding the Future: Energy Policy Scenarios to 2050” (available on www.worldenergy.org). The study had a bottom-up rather than the traditional top-down approach and was carried out in 67 WEC Member Countries by 400 individuals who were typically decision makers that plan and manage regional and local energy systems on a daily basis. The study was qualitative with some quantitative validation.

Four scenarios were evaluated on the basis of positive and negative implications for the achievement of the WEC Millennium Goals: Accessibility (access to affordable modern energy for all people), Availability (reliable and secure energy supply) and Acceptability (protect the local and global environment).

The study concluded with the following key messages:

To meet the energy needs of all the people in the world, global energy supplies will have to double before 2050;

The world has sufficient energy resources, knowledge, skills and capital to meet the supply needs; the challenge is to get them from where they are plentiful to where they are needed most;

We can address the world’s accessibility needs in harmony with the effective management of acceptability, thereby mitigating against both social and environmental degradation;

Higher energy prices will drive efficiency and attract capital investment in developed countries but robust international cooperation and integration is necessary to avoid unintended negative consequences and exacerbating energy poverty in developing countries;

Private sector engagement is essential – influencing national policy, driving business policy, and ensuring focus on sustained delivery of the policy intent.

In October, the New Zealand Energy Strategy was launched alongside the New Zealand Energy Efficiency and Conservation Strategy, and the December EFNZ workshop included a session on Energy Efficiency and Conservation. There were four presentations resulting in some lively discussion of the traditional dominance of supply side issues over demand side issues.

Another session centred on an overview of the EnergyScape project, that is currently funded by FRST for a period of 16 months, to identify the range of supply and demand issues. A conclusion from the session on Resilient, Low Carbon Transport was that if New Zealand is serious about climate change, consistent long term policy would be needed. One presenter in the session on Strategy on Low Emissions Power and Heat considered that the New Zealand Energy Strategy undervalued the potential of industrial energy efficiency projects for cost effective greenhouse gas abatement. The session on Security of Electricity Supply heard from Transpower that the 90% renewable electricity target had a ‘significant to extensive’ range of implications for the transmission grid in its roles of energy transport, security of supply and providing a competition platform. In particular, improved market dispatch systems would be needed to maintain security when the grid has to cope with a large proportion of intermittent wind generation.