They are wrong, because they overlook a vital fact – our in country storage capacity. It is estimated our in country capacity is around 28 days worth of petrol. We currently have 27.9 days according to MBIE.
What would happen if we reduced petrol consumption now by 20% for 10 days. Would that give us two extra days of fuel? No. Because we can’t store 30 days of fuel. Only 28. So what would happen is our petrol companies would actually have to cancel a tanker coming to NZ, as there would not be enough storage for them to offload. And once you start cancelling tankers, you may find it hard to get them coming as regularly as before.
You might think, how about we pay the tankers to just stay berthed in NZ. That could increase our capacity to say 35 or 40 days. Well first of all this will reduce global supply as there would be fewer tankers available to ship the petrol. And imagine what would happen if other countries started doing this also. Supply would really take a dive.
The reality is that while we still have tankers coming regularly to NZ to refuel our supplies, any demand reduction measures won’t make a significant difference. You might want to do it for cost saving purposes, but using 20% less now, won’t mean we have 20% more in the future. It will just mean less fuel comes to NZ.
Now once we start to experience a drop off in supply (which sadly is very possible, even probable), then yes conservation measures will be needed, and will even be vital. But fortunately we are not there yet.
Now you could argue we need more storage capacity in NZ, and I would agree. Obviously this is not something trivial to do, but any increase in storage capacity would obviously increase our resilience. So capacity, not supply, is the issue for now.
David Farrar runs Curia Market Research, a specialist opinion polling and research agency, and the popular Kiwiblog where this article was sourced. He previously worked in the Parliament for eight years, serving two National Party Prime Ministers and three Opposition Leaders.
You might think, how about we pay the tankers to just stay berthed in NZ. That could increase our capacity to say 35 or 40 days. Well first of all this will reduce global supply as there would be fewer tankers available to ship the petrol. And imagine what would happen if other countries started doing this also. Supply would really take a dive.
The reality is that while we still have tankers coming regularly to NZ to refuel our supplies, any demand reduction measures won’t make a significant difference. You might want to do it for cost saving purposes, but using 20% less now, won’t mean we have 20% more in the future. It will just mean less fuel comes to NZ.
Now once we start to experience a drop off in supply (which sadly is very possible, even probable), then yes conservation measures will be needed, and will even be vital. But fortunately we are not there yet.
Now you could argue we need more storage capacity in NZ, and I would agree. Obviously this is not something trivial to do, but any increase in storage capacity would obviously increase our resilience. So capacity, not supply, is the issue for now.
David Farrar runs Curia Market Research, a specialist opinion polling and research agency, and the popular Kiwiblog where this article was sourced. He previously worked in the Parliament for eight years, serving two National Party Prime Ministers and three Opposition Leaders.
No comments:
Post a Comment
Thank you for joining the discussion. Breaking Views welcomes respectful contributions that enrich the debate. Please ensure your comments are not defamatory, derogatory or disruptive. We appreciate your cooperation.