The Major Energy Users Group (MEUG) said one of its members – Pan Pacific Forest Products – closed its mill near Napier over the weekend due to high power prices and it would remain shut until they came down.
MEUG chairman John Harbord said it looked likely that more plants would close their doors in response to high wholesale prices, which this week hit $860 per megawatt-hour (MWh) from $194.49 MWh at the start of June.
“What you are going to see is the flow-on impact,” he said.
“Pan Pac, for instance, by themselves, comprise 30% of the business going through the Napier Port, and they supply wood chip to a whole lot of businesses up and down the East Coast of the North Island, and these businesses don’t have more than a month’s supply of wood chips.
“The provincial communities, where a lot of these big businesses are based, are facing the prospect of bleak times ahead,” he said.
On Wednesday, Oji Fibre Solutions said its Penrose paper recycling plant, which employs 75 people, may have to close due to high energy costs.
The news followed Winstone Pulp International’s decision to pause work for 14 days at its two central North Island operational sites because of high power prices. . .
The price is reflecting demand that’s higher than supply and that’s partly due to Labour’s decision to unilaterally axe oil and gas exploration and the uncertainty over its battery project at Lake Onslow which deterred companies from developing other options.
But could this be part of the reason prices are too high too?
When Meridian Energy was seeking resource consents for a West Coast hydro dam proposal in 2010, local Maori “strenuously” objected, claiming their mana was inextricably linked to ‘their’ river and could be damaged.
After receiving a financial payment from the company however, the Ngai Tahu sub-tribe changed its mind and publicly supported the scheme.
Meridian declined to say how much they paid the iwi, but confirmed it was “to offset the impact of the project on the mauri [life force] of the river.”
Fast forward to November 2023, and Meridian, along with Genesis Energy, is reported to have spent “more than $180 million to smooth the path of re-consenting their Waitaki hydro scheme. This includes payments to three Ngai Tahu hapu, the Department of Conservation and others in exchange for supporting the application.”
DOC has confirmed it received $2.3 million, so it appears the lion’s share of $180 million has gone into Ngai Tahu’s coffers to satisfy their ‘concerns’. . .
Central South Island Fish and Game would receive $80,000 per annum, or $2.8m over 35 years to support the delivery of programmes relating to the research and enhancement of the sports fishery and game birds in the catchment.
The RMA allows what might be called compensation.
But is it also a brownmail and greenmail power play?
Call it what you will, these payments must be contributing to higher power prices.
Dare we hope that proposed changes to the Resource Management Act will put a stop, or at least a damper, on such payments?
Ele Ludemann is a North Otago farmer and journalist, who blogs HERE - where this article was sourced.
6 comments:
There needs to a ban on EV charging for the winter.
Given that most who purchase EV are running a virtue signaler and are also likely wealthy they will have a proper car in the garage to fill the gap.
A few thing at play in the south island,
RMA, Iwi and the electricity market.
For the RMA to get in the way of generation is criminal. The way our system operates should never be compromised by a system that impedes the functioning of a country such as ours.
Iwi, in this case, Ngaitahu, holding organisations to ransom is criminal. Withdrawing objections after payment to "appease"
a mythical entity should be obvious to everybody that its a rort of the first water. (pun intended)
The electricity market is a fiasco. It has not done what was intended, supposedly to increase competition between generators which will never work.
Electricity is a commodity that 99% of the country needs to function. Generate employment, create exports, etc. etc,
It's no surprise some companies consider closing down due primarily because of variable power charges.
As a small aside, how can a generator (manufacturer) sell at retail prices to consumers when retail sellers must first buy from manufacturer. It seems the generator is creaming it off the consumer.
I would think the generator would sell to consumers at cost plus, not a retail price,
The point that needs consideration, is all the money that Ngai Tahu "have received, to flatten ruffled feathers, there will be NO tax paid". The other group that needs to prove accountability, on monies received, is Central South Island Fish & Game, as I question the 35 year time span why "if indeed it will take that long", on research?
As for DOC, they need to "explain, why they made a donation", and the appropriate Govt. Minister needs to call the Director of DOC to explain. That is if we have a Govt Minister "bold" enough to that.
A couple of things - firstly the clout wielded by Ngai Tahu is an absolute (sick) joke. Virtually no Maori lived in the South Island prior to colonisation - it's simply too cold to survive winters there when running around barefoot in grass skirts. With high 'carbon' costs imposed on running the coal-fired Huntly plant, I suspect that it is not running full time at full capacity (should be on Huntly coal too BTW) to preserve dwindling hydro reserves. If true, the blame for the immediate situation would therefore lie with the ETS, and could be cleared by giving Huntly 'emergency concession' to run at capacity.
The Cook Strait power cable needs replacing and the public has been asked to comment.
When is the Taniwha or other mystical creature going to appear in the Strait ?
Without a doubt, appeasement in the form of millions of dollars will be required or else the cable will damaged.
BTW, the old cable should never be taken out of service - we rely far too much on this cable spanning two active tectonic plates.
So what if Maori don't give their approval again ?
If it was OK 30 years ago, nothing has changed except Maori belligerent and demands for more dollars.
Are we going to stop this power generation simply because some part pakeha / part Maori will not sign off on a document which is a nonsense anyway ?
Stop pandering to them and see what happens.
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