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
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