Collins JudithENERGY INNOVATION (ELECTRIC VEHICLES AND OTHER MATTERS) AMENDMENT BILLThird ReadingHon JUDITH COLLINS (Minister of Energy and Resources): I move That the Energy Innovation (Electric Vehicles and Other Matters) Amendment Bill be now read a third time. This bill is an important part of the Government's work to improve the efficiency of our energy use and to meet our climate change commitments. We need a shift in focus to reduce our emissions and improve our energy productivity. Transport energy and process heat are key areas where gains can be made. This bill makes small but significant changes that will assist the Government and New Zealand to make that shift in focus. Much of the energy our industries use to create heat for processing is non-renewable. Process heat makes up one-third of New Zealand's overall energy use and contributes 9 percent of gross emissions. Sixty percent of process heat is supplied using non-renewable fuels mainly coal and gas. The industrial sector is the largest end-user of process heat; 80 percent of total process heat occurs in this sector. There are opportunities for some businesses to switch to more efficient non-renewable sources of energy like gas or to improve the efficiency of the energy that is currently used. I today released a replacement New Zealand Energy Efficiency and Conservation Strategy which includes process heat as a priority area as well as an action to develop a plan to unlock the energy efficiency in renewables potential in this sector.Another priority area in that strategy is transport. Greenhouse gas emissions for the transport sector make up about 20 percent of New Zealand's total emissions and over 40 percent of New Zealand's emissions from the energy sector. With 99 percent of transport energy coming from non-renewable sources there is a huge opportunity to reduce emissions in the sector. The high amount of electricity that is generated in New Zealand from renewable energy sources such as hydro geothermal and wind means that electric vehicles (EVs) provide an excellent way to make the most of this opportunity to reduce emissions. EVs can leverage greater value from New Zealand's renewable energy and electricity of which electricity was 88 percent in the 3 months to December 2016 reducing emissions while ensuring economic growth. Last year the Government announced the Electric Vehicles Programme a package of proposals to increase the uptake of electric vehicles. Substantial progress has been made in delivering the programme and the number of electric vehicles on our roads has increased significantly from around 1300 when the programme was announced to around 3500 now.The bill contains two further initiatives from the programme. The bill clarifies that a road controlling authority may use its bylaw-making powers to give electric vehicles access to special vehicle lanes. While road controlling authorities wish to use this power electric vehicles that are powered solely by electric batteries as well as plug-in hybrid vehicles that operate on a combination of externally charged batteries and a petrol-diesel motor will be able to use special lanes. This measure has proved a useful way to encourage the uptake of electric vehicles. I recently travelled to San Francisco where there has been a substantial growth in EV ownership. There they have provided rebates but also use similar measures to those we are introducing such as access to special vehicle lanes.The bill also encourages the uptake of electric vehicles by extending the road-user charge exemption to include heavy electric vehicles such as electric trucks and buses. The exemption already applies to light electric vehicles. This change is a transparent and efficient financial incentive to encourage heavy electric vehicles over equivalent conventional heavy vehicles. The exemption for heavy electric vehicles will be in place until they comprise 2 percent of the heavy vehicle fleet. The Government has a target of doubling the number of electric vehicles every year to reach approximately 64000 by the end of 2021 and this bill will help to ensure continued progress towards that target. The bill also makes some important changes to the way the Energy Efficiency and Conservation Authority (EECA) is funded. EECA is the Crown agency tasked with encouraging promoting and supporting energy efficiency conservation and the use of renewable sources of energy. It is important that EECA can focus its activities where the gains are the greatest—for example on transport energy and process heat. The bill does this by giving EECA access to funding from three levies: the existing electricity efficiency levy the gas levy and the petroleum or engine fuel monitoring levy. This will enable the cost of EECA's levy-funded activities to be spread across these three fuels instead of being confined to electricity. An example of the sort of work that EECA will be able to progress using this funding is the electric vehicles promotional campaign and the low-emission vehicles contestable fund. The first round of the low-emission vehicles contestable fund saw 15 projects funded including the delivery of at least 100 new public charging stations around the country. It also saw support for an electric car - sharing scheme and electric trucks buses and supermarket delivery vans. These types of projects are bringing electric vehicles and charging stations into New Zealand neighbourhoods encouraging and supporting the uptake of EVs. The bill also makes changes to ensure that legislation is keeping up with innovative changes in the energy sector. For example the bill clarifies how electricity industry regulation applies to secondary networks. These are electricity networks that are indirectly connected to the national grid. The changes will ensure that when owners of secondary networks undertake activities equivalent to those of an electric distributor they should be subject to and benefit from the same regulatory requirements. I want to acknowledge my colleague the Hon Simon Bridges the previous Minister of Energy and Resources for the work that he has put into this as well. The bill has had only minor changes through its passage. I think these have improved the bill and I would like to specifically thank the Commerce Committee and the members of this House for their excellent consideration of constructive engagement with and support for this bill. I would particularly like to acknowledge the chair of the committee Melissa Lee MP. I would also like to thank the Ministry of Business Innovation and Employment and Ministry of Transport officials for their very good work on this bill. This bill will encourage energy innovation such as emerging energy technologies and will increase variation in energy-related business models along with a significant shift in how we power our cars and trucks and buses. This will enable us as a nation to respond to our environmental and energy objectives. I commend this bill to the House.