Friday, December 16, 2022

Point of Order: Greens are cheered by renewable energy news and exploration pause.....

........but overseas coal exporters will be delighted, too

The Point of Order team will be keeping an eye on how coal imports are affected by one of the latest Beehive announcements. We share ACT’s belief that global coal exporters will be delighted by the news.

The announcement – from Energy and Resources Minister Megan Woods – is that the government is stalling on the granting of further petroleum exploration permits, beyond the work already underway, until early in the next Parliamentary term.

So what’s the link between this announcement and the graph above, showing a burgeoning of coal imports in recent years.

               Click image to view

The graph has been posted on The Facts website along with data which show:1989 – 1999: almost no coal was imported into New Zealand
  • 2000 – 2006: coal imports rapidly increased, especially from 2002 to 2006
  • 2007 – 2012: coal imports rapidly decreased, hitting almost zero again in 2012
  • 2013 – 2018: coal imports remained stable
  • 2019 – 2021: coal imports rapidly increased to new highs, overtaking coal exports in 2021 (more on why next week)
  • 2022: only half-year data is currently available, so has not been shown:
    • March 2022: Imports of 126,080 were ~half of Exports of 245,793 tonnes
    • June 2022: Imports of 404,811 exceeded Exports of 324,999 tonnes
Hmm. So what triggered the spike in coal imports on the Ardern government’s watch?

We don’t profess to be sure about it, but in 2018, the Government announced an end to new offshore oil drilling.

Fair to say, Megan Woods disputes any link between the drilling ban and the surge in coal imports.

She became decidedly antsy when ACT climate change spokesperson Simon Court linked record coal imports with the 2018 decision. She said the government was stockpiling coal as a result of the drier La Niña weather pattern New Zealand was then experiencing.

Woods is now expressing her determination to encourage greater use of renewable energy in the push to reduce carbon emissions.

Her statement yesterday was that –

The Government is seeking public feedback on the development of offshore renewable energy infrastructure like wind farms, Energy and Resources Minister Dr Megan Woods said today.

Woods’ colleagues, meanwhile, were announcing –

The Foreign Ministers of New Zealand, Australia, and Canada have issued the following

Foreign Minister Nanaia Mahuta today announced the appointment of Tara Morton as the next Ambassador to Spain.

The Government welcomes news the national drug-funding agency Pharmac plans to fund two medicines to help New Zealanders with advanced non-small cell lung cancer.

Megan Woods highlighted these points in her announcement on what’s happening on the renewable energy front: 
  • Feedback is being sought on the development of offshore renewable energy such as wind farms.
  • Decisions on future block offers for onshore petroleum exploration will be deferred until early in the next parliamentary term.
“Offshore renewables have the potential to produce the electricity needed to replace fossil fuels and support New Zealand’s transition to net zero by 2050,” Megan Woods said.

“Technology like wind farms set off the coast of New Zealand can deliver a clean, stable source of renewable energy to help us become more energy-independent and avoid the fluctuations in cost of fossil fuels like oil and coal.

“The proposals released today set out potential approaches to manage feasibility activity, with consideration of environmental and cultural factors alongside commercial viability.”

Cultural factors?

What consideration should they be given if urgent and significant action must be taken to save humanity from the grim impacts of climate change?

Plenty, apparently. Woods said the potential environmental and cultural impacts will be closely examined before decisions are made about what projects could be constructed, and

… this will require developers to work closely with iwi to understand these impacts.

Ah, that’s what this is all about. Only some cultural impacts will be closely examined.

Woods further said:

“We firmly see Taranaki’s future as still being an energy future. New Zealand has high levels of renewable resources – so we are well positioned globally to create a sustainable energy system for generations to come.”


“Ensuring we have the right settings in place to encourage development of offshore renewable infrastructure will enable us to deliver net zero emissions by 2050.”

We had to drill through all that stuff about renewable energy and the importance of cultural considerations before learning –

Today Megan Woods also announced the Government is deferring decisions on future petroleum block offers.

In 2018, the previous Coalition Government announced an end to new offshore oil drilling and committed to another three rounds of block offers (2018, 2019 and 2020), which is the permit tender process for new drilling in onshore Taranaki.

The government also said then decisions about future block offers beyond those committed would be made at a later date.

Two of the tenders have been completed and the last (2020) remains in progress.

The latest announcement puts the kaibosh on the granting of further petroleum exploration permits – beyond what is already underway – until early in the next Parliamentary term.

“I am not committing to any further block offers now. Decisions will be made early in the next Parliamentary term when there will be a better evidence base of future demand,” Megan Woods said.

“This Government is committed to scaling up the renewable energy sector to phase out harmful fossil fuels. While fossil fuels remain essential today, the needs of tomorrow need to be properly understood to support future generations of New Zealanders,” Megan Woods said.

So whose advice will loom large, as Woods thinks about what’s best for future generations of New Zealanders?

Her statement tells us:

“During this time, I will continue engagement with Taranaki hapū and iwi on the future of the block offer process, to better understand their position.”

But the press statement does go on assure others who might want to express their views:

Have your say on the offshore renewable energy consultation on the MBIE website here:

Submissions will be used to help inform policy decisions to enable early feasibility assessments to develop offshore renewable energy infrastructure in New Zealand. Submissions close on 14 April 2023.

The statement explains that offshore renewable energy is energy generated in or on the sea from reusable, infinite natural sources such as wind, ocean currents, light or heat from the sun, rain and geothermal heat. Under the Emissions Reduction Plan, the Government has committed to put in place a regulatory regime for offshore renewables by 2024.

There are many ways of harnessing offshore renewable energy including floating solar and floating wind turbines, and infrastructure on the seabed itself such as those used for wave energy, tidal energy, and offshore wind. These technologies are emerging and are in various stages of development internationally. Fixed foundation offshore wind technology is the most mature of the offshore renewable energy sources today.

Before decisions can be made on whether to construct and operate offshore renewables, significant feasibility studies are needed to examine commercial and technical viability, and cultural and environmental impacts on the marine environment and existing uses of it.

The proposals set out options for how developers might assess feasibility. This could involve working in conjunction with one another or competing for permits that provide exclusive rights to do feasibility studies in an area.

Later next year, MBIE is expecting to consult on further regulatory settings to enable infrastructure to be constructed, operated and decommissioned.

ACT leader David Seymour responded to Woods’ announcement by claiming:

“Labour’s decision to pause any further block offers until the next term of Parliament kowtows to a tiny group of environmental activists and ignores the interests of millions of productive Kiwis.

“It sends a shameful message and will take a wrecking ball to investor confidence.

“This decision will hurt the economy and the environment as exploration simply moves offshore.”

The decision to ban new offshore oil and gas exploration in 2019 was done without analysis, without a Cabinet decision, and without public consultation, Seymour said.

“It was subsequently revealed that there was no cost-benefit analysis and the Parliamentary Commissioner for the Environment found it would actually increase global emissions by forcing activity offshore.”

Seymour said Woods’ latest decision has been “dumped” right before before Christmas when people aren’t paying attention to politics and

“… sends the message that New Zealand isn’t open for business.”

Oil and gas is the lifeblood of our civilisation, Seymour insisted.

“Everything from computers, to cosmetics, to raincoats and backpacks, to the plastic in our phones are made from New Zealand petroleum products. If New Zealand stops playing its part in the manufacturing process other countries will just pick up the slack.

“The Greens would like to lead us back into the dark ages.

“We particularly need clean natural gas as a transition fuel.”

Oh – and Seymour reckons global coal exporters will be jumping for joy.

He referenced figures from MBIE showing coal use for electricity generation is up 29.5 per cent in the past year.

The Green Party, on the other hand, is welcoming a pause on all remaining oil and gas exploration, and is calling on the Government to stop it all together.

The Government should also adopt Eugenie Sage’s member’s bill to ban any new coal mines anywhere in New Zealand and protect conservation lands and waters from any new coal, gold and other mines, Green MP Julie Anne Genter said.

That advice may well be supported by global coal exporters, too.

Point of Order is a blog focused on politics and the economy run by veteran newspaper reporters Bob Edlin and Ian Templeton

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