Several years ago, while visiting Norway, I stayed with a family in a fairly remote part of the country. Their underfloor electric heating ran around the clock, even during the warmer months while I was staying there. When I asked why, I was told that electricity was so cheap there that switching the heating off was hardly worth thinking about. Norway had invested its natural advantages, including abundant hydroelectricity, in infrastructure that served its people. This was despite their massive oil reserves and income that it generated for them. This was despite their massive oil reserves and the income it generates for them.
My friend Paul Mulvaney, a veteran Kiwi journalist, responded to this story by pointing out that New Zealand once had a similar philosophy. Our electricity system was developed as essential national infrastructure, intended to provide abundant and affordable power for homes, farms and industry. From the late 1980s onwards, however, we increasingly corporatised electricity and treated it as a commercial commodity. The purpose gradually shifted from serving the public towards earning returns for companies, governments and shareholders. We were promised lower prices and more reliable electricity. We received neither.
Paul also noted the peculiar way our wholesale electricity market operates. When expensive gas or coal generation is needed to meet demand, that higher marginal price can influence what all generators receive, including hydroelectric generators producing power from water stored behind dams built many decades ago. There may be sound economic arguments behind this arrangement, but New Zealand families are entitled to ask whether it consistently serves them. I think it fails to serve us as promised, and I think I am speaking for most Kiwis.
Norway has also made a very different choice about its wider natural wealth. Rather than simply consuming the proceeds of its oil and gas, it invested much of that income through its sovereign wealth fund. This fund is now one of the largest investors in the world, owning stakes in thousands of companies and helping protect the interests of future Norwegian generations. I understand that the Norwegian sovereign wealth fund owns the cutting rights to massive tracts of New Zealand exotic forest. While Norway’s domestic electricity is no longer virtually free, particularly since greater connection with European markets, but the founding principle remains instructive: national resources should leave the country and its people stronger. New Zealand is doing the opposite.
New Zealand is hardly short of natural advantages. We have hydroelectricity, geothermal energy, wind, rainfall and considerable engineering ability. Yet many families are reluctant to turn on a heater during winter. Children sleep in cold, damp bedrooms while electricity companies report substantial earnings. Whatever one thinks about public ownership, private ownership or the present market structure, that result should trouble us.
The Free Rangers vision is that New Zealand should be the best place in the world to live and raise a family. A warm, dry home is not an extravagant ambition. It is a foundation for healthier children, stronger families and productive communities. Paul’s message leaves us with a question worth asking: what is New Zealand’s natural wealth actually for, if ordinary New Zealanders cannot afford the essentials it ought to provide?Gary Moller is a Health Practitioner who is focused on addressing the root causes of ill health or poor performance. This article was first published HERE
My friend Paul Mulvaney, a veteran Kiwi journalist, responded to this story by pointing out that New Zealand once had a similar philosophy. Our electricity system was developed as essential national infrastructure, intended to provide abundant and affordable power for homes, farms and industry. From the late 1980s onwards, however, we increasingly corporatised electricity and treated it as a commercial commodity. The purpose gradually shifted from serving the public towards earning returns for companies, governments and shareholders. We were promised lower prices and more reliable electricity. We received neither.
Paul also noted the peculiar way our wholesale electricity market operates. When expensive gas or coal generation is needed to meet demand, that higher marginal price can influence what all generators receive, including hydroelectric generators producing power from water stored behind dams built many decades ago. There may be sound economic arguments behind this arrangement, but New Zealand families are entitled to ask whether it consistently serves them. I think it fails to serve us as promised, and I think I am speaking for most Kiwis.
Norway has also made a very different choice about its wider natural wealth. Rather than simply consuming the proceeds of its oil and gas, it invested much of that income through its sovereign wealth fund. This fund is now one of the largest investors in the world, owning stakes in thousands of companies and helping protect the interests of future Norwegian generations. I understand that the Norwegian sovereign wealth fund owns the cutting rights to massive tracts of New Zealand exotic forest. While Norway’s domestic electricity is no longer virtually free, particularly since greater connection with European markets, but the founding principle remains instructive: national resources should leave the country and its people stronger. New Zealand is doing the opposite.
New Zealand is hardly short of natural advantages. We have hydroelectricity, geothermal energy, wind, rainfall and considerable engineering ability. Yet many families are reluctant to turn on a heater during winter. Children sleep in cold, damp bedrooms while electricity companies report substantial earnings. Whatever one thinks about public ownership, private ownership or the present market structure, that result should trouble us.
The Free Rangers vision is that New Zealand should be the best place in the world to live and raise a family. A warm, dry home is not an extravagant ambition. It is a foundation for healthier children, stronger families and productive communities. Paul’s message leaves us with a question worth asking: what is New Zealand’s natural wealth actually for, if ordinary New Zealanders cannot afford the essentials it ought to provide?Gary Moller is a Health Practitioner who is focused on addressing the root causes of ill health or poor performance. This article was first published HERE
8 comments:
New Zealand’s energy dilemma can be laid at the feet of political stupidity that has dominated parliament for the last few decades on both sides of the house. We export coal to China to feed their energy plants 24-7 that produce solar panels and windmills to sell tto Western fools like us. I now realise that net-zero is the official measurement of political intelligence.
When I moved to NZ thirty years ago I was amazed at the damp cold housing. I emailed the WHO about the recommended minimum temps in housing, and the WHO basically said NZ is a First World country and should be able to sort their own problems.
' what is New Zealand’s natural wealth actually for'? Our main political parties think the answer to this question is return it all to the relevant Iwi so they can enslave the non indigenous people.
Anecdotes require context. In Oslo today, the web informs me that the average wholesale price was 20cNZ per Kwh. Here, it is a lot less.
However, in the north of Norway, power is much cheaper, they have so much spare which their grid can't get south (yet), so it is priced much more cheaply.
Families in Norway have great subsidies for being a family, which lifts their incomes substantially - as we know, they are much wealthier than us.
Norway has abundant energy, 90% hydro with massive storage, and they export a lot of their excess. We do not have abundant energy: we have around 75-80% hydro and geothermal we can always rely on and then the unreliable intermittent sources.
Houses are not damp primarily because they are not heated, but because they are badly built and ventilated - not an electricity problem.
We have the 9th lowest (one better than Oz) retail electricity prices in the OECD, of which mostly Europe are members.
Now Google is offering Gemini, it's worth doing five minutes research before using a keyboard, it saves so much time.
Gary, I agree with Clive Thorp on this. There is plenty of insightful commentary on the NZ electricity industry available, including from the likes of John Raine and Brian Leyland who regularly feature on Breaking Views. Nostalgia for the monopolistic, bureaucratic and hopelessly inefficient structures of the late 1900s is a recipe for disaster. I was on the Board of one of the gentailers when they were all partially corporatised and I can tell you we achieved far greater output with much fewer resources when the organisation was exposed to the disciplines of the private sector. The subsequent deterioration is attributable solely to the folly of shunning fossil fuels and embracing hugely expensive woke technologies in a futile attempt to impersonate King Canute.
I grew up in the 1950’s and 60’s in an uninsulated home in ‘Nappy Valley’ Wainuiomata. There were times when there was ice on the inside of the windows, we loved it! Same with walking to school in the frost, cold but how great to warm up in front of the wood burning heater in the classroom.
My Scottish parents knew that dry air was better than damp and that ventilation was important.
I worked for a few years cleaning mould in houses, the worst were where people closed themselves in, keeping the moisture from their breath trapped in the rooms.
More people, more breath, more moisture, more mould.
To dreadnought: JHC, we no longer live in the 1950s--everybody put some fricking insulation in your houses!!!!!!!!! Too many are cheap as Scots.
Anonymous 10:09 , Better still open some windows in the morning . Dry air heats quicker than moist air
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