Smith StuartSTUART SMITH (National—Kaikōura): Well thank you Madam Speaker. It's a wonderful opportunity to speak on the Sustainable Biofuel Obligation Bill which the National Party will not support.I thought it really took the cake when the Minister of Energy and Resources talked about the Government Investment in Decarbonising Industry Fund and holding that up as an example which is an example of corporate welfare not of actually reducing emissions. A prop. The Minister said that this side of the House had supported the legislation and we have to explain how we're going to reduce emissions. Well actually the Labour Party supported an ETS—an emissions trading scheme—to reduce emissions. They seem to not understand how it works; they have no idea how it works. They think that emissions will be reduced by the wise hand of the Minister intervening in little places here and little places over there to lower emissions. It's an absolute load of nonsense quite frankly.I think it's absolutely brave of the Minister—heroic I would say—to stand up here and advocate for a biofuels mandate that will add at least 10c a litre to the cost of fuel when the moment that actual petrol prices started to go up what did they do? They panicked—they panicked and reduced the excise tax by 25c a litre. We now have the New Zealand Unit price at $88.50 today driving up the cost of fuel. So do we really think that on 1 January they are going to reintroduce the 25c of excise tax? I don't think so. There's no chance that they're going to increase the price of fuel by 10c—at least—later on by introducing this bill. They won't have a show. This will add further costs. Upstream providers those that import the fuel will have to invest significant sums of money. Some are up to $50 million—I don't know how much others are going to have—that's their estimate at this stage. However they haven't actually gone to the extent of planning exactly what they're going to spend because they don't know. Because the legislation has only just been tabled last week they have to actually go to their head offices to get the money to invest it. They'll get the money but they need to know exactly what it's going to mean.In this bill we don't even know what the definition of the feedstock" is because that's up to the wise hand of the Minister to decide on an ad hoc basis! This is absolute uncertainty—these companies are running around in circles wondering what the heck they're going to do. But they're going to have to recoup that cost those millions. That will go directly on top of the cost of fuel. So it won't be 10c a litre; it will be a greater cost.There are other problems. The RAP—the Refinery to Auckland Pipeline—will not be able to take biofuels or biopetrol anyway down that pipeline. They're not able to do that. There are significant issues with mixing those fuels. So there will have to be two fuel stores at the ports where the fuel will be mixed into the tankers as it goes off to the fuel stations adding costs and complications. The downstream retailers will also—that is the petrol stations themselves—have to invest in updating their outlets. So more cost that will go on to the per-litre price of petrol.So biofuels are extremely expensive. They're going to add a lot of fuel. But the question is—the Minister touched on it—are they actually going to be sustainable? What the Minister mentioned was that they wouldn't take food crops. But actually news for the Minister: there are a lot of other crops that are not food crops that can be grown on land that could be growing food. They'll be displacing food crops—so impacting food production price accrued and yet adding more cost.However biodiesel which I haven't really touched on till now is used extensively in heavy transport of course in agriculture and in fishing. Now the cost of biodiesel is going to be likewise at least 10c a litre. All of those costs go and impact not only those producers but it goes directly on top of the cost of food because everything that we consume in New Zealand goes on a truck. It might come in by ship it goes into road transport and will be delivered to a distribution centre and then it will go from the distribution centre to the supermarkets and all those sorts of things. Those costs just keep going on to all of those goods.Who's going to be impacted by this? Who do we think it is? Do we think it's the oil companies? No. It won't be the oil companies; it will be low-income families that will suffer the most. It seems ironic that the Labour Party seems to be bringing in more and more bits of legislation that will impact the most on poorer families—low-income families. They don't seem to care about them.The issue then with feedstocks is that as I said earlier these are not prescribed in the legislation. The Minister has the power to say what is acceptable and what isn't—that wise hand of the Minister yet again! Unfortunately central control doesn't work well in these situations. More likely than not palm oil will end up as part of these fuels cooking oil—Neste who will be a major provider have said that they will avoid that that they will use cooking oils. Where do cooking oils come from? Palm oil. So palm oil will find its way into this. So we're now going to be responsible in part for Amazonian rain forest destruction in order to save the planet from climate change. I think the Minister has got this completely round the wrong way. It would have been far better to have focused on sustainable aviation fuels if that was where they wanted to go in terms of biofuels. There is no other alternative. There are alternatives with electric vehicles and hybrids. That is already reducing our emissions profile and that's been driven by the emissions trading scheme sending a strong market signal that people are reacting to. But yet once again they don't seem to understand the emissions trading scheme. It's unbelievable that they can stand up in front of this House and not understand how the emissions trading scheme actually operates. I think that's actually quite shameful. Tallow was going to be a major part of it. Actually Z Energy had a biofuels plant in New Zealand and they could not make it work.The National Party believes in biofuels. That's great. If people want the opportunity to use them they should be able to do that. But there are problems. Older vehicles cannot handle biofuels; it ruins their carburettor and fuel systems. So how's that going to be dealt with? There will be no alternative if this was to go. Of course the National Party will repeal it if it comes in.So what we know though is that these companies are so uncertain they won't be able to meet the 1 April 2024 date anyway because of all of the time constraints involved in obtaining the funding putting in the infrastructure but they'll just pay the $800 a tonne—carbon dioxide which is the fine that's being mandated in this legislation—and they'll just pass it on to the motorist yet again in the cost of living crisis.If they think they're going to bring this in and add 10c—I'll tell you what: inflation will still be around by 2024—I think they're dreaming. That's the political reality. Well of course a lot of them won't be here to find out anyway.Tallow as I said is part of the—Z Energy had to give up making biofuels because they couldn't manage the costs. The cost of tallow went up by 400 percent. You can't sustain those sorts of levels of costs.Todd Muller: Tell them they're dreaming!STUART SMITH: Yeah well they are dreaming.Hon Member: It went up because of its export price.STUART SMITH: Well yeah it went up because it's an export. It's a highly competitive market. It's economies of scale. We don't have it.So we will be exporting feedstocks overseas to be processed into biofuels to be shipped back to New Zealand with high emissions.There's a lot of platitudes in this and as one commentator said in the war between platitudes and physics physics remains undefeated. So it's time they got some good sense on the other side and didn't come up with silly legislation and let the emissions trading scheme do its work."