Shirley Ken: General Debates 
Shirley Ken: General Debates 
[Volume:608;Page:5480] 
Hon KEN SHIRLEY (Deputy Leader—ACT NZ) 
: 
 This Labour Government is looking very vulnerable and very inadequate on many fronts. Perhaps two of those fronts where it is looking most vulnerable and where it has stumbled badly in recent months are firstly the foreign policy and defence issue where it has left this country in a very unfortunate situation—and increasingly the public of New Zealand is appreciating the fact of that vulnerability—and secondly the energy crisis that clearly is looming and is a growing concern to us all. 
That crisis did not come out of the blue. At question time today the Minister of Energy conceded that his own advice—to himself actually—last October was that alarm bells would be ringing this year. But he did nothing. Why? Because he is caught up in a Cabinet that has a philosophical mindset. Pete Hodgson actually believes in the market. He has got his head round the energy sector and he is a proponent of “more market”. Unfortunately the Prime Minister and the balance of Cabinet want “more regulation”. They think the solution is more Government and more regulation. That is certainly not the solution. 
The Government has been prone to blame all the problems in the energy area on Max Bradford’s reforms. Well Max nearly got it right. On balance he did a great job. The one serious error he made was when he forced the split between the lines and energy companies and destroyed foreign investment confidence. That drove companies like TransAlta out of the country. Think about it: they have all gone. They have all just quietly left at a time when we need investment in infrastructure investment in our grids investment in our generation capacity. All those foreigners have gone and they have said: “Who would come to New Zealand?”. 
It is partly because of the Resource Management Act and administrative problems but the big problem is Government. If Governments keep changing the rules and confiscate property rights take property rights without warning then who would invest in that sort of climate? International investment dollars are like water: they flow to the level where they will get the best return. If Governments create barriers to investment then they should not be surprised when foreign investors just quietly walk away. 
Of course the other aspect is that the sale of ECNZ was not done in an optimal way. Why? It was driven by the administrators—the old ECNZ engineers—and they wanted to retain their empires. Is it a coincidence that they smashed down the smokestacks at the Marsden B power station? That station was just coming to completion. They did not want any new entries any new generators. They engaged in economic vandalism and destroyed the smokestacks. Now when we want to bring that station back on in a hurry because it is needed we cannot. The pipeline is rusted because it has not been maintained; and the smokestacks were deliberately destroyed by the outgoing ECNZ. Those people are the same characters who now are running the regional monopolies of the Government’s State-owned enterprises. 
If we look at the Meremere power station situation we see that Olivine wanted to step in there incinerate wastes and generate electricity—a very very good proposal. But those administrators had destroyed the smokestacks so the Meremere power station could not be restarted. What has Olivine done? It has gone off to Perth Australia. It got consent there in 7 months when it had taken it 7 years in New Zealand to get nowhere. That company is now building a world-leading high-temperature incineration facility. What are we doing? We are dumping all our wastes at Hampton Downs and other landfills because that is what the Government deems as the solution. Clearly it is not. 
We have also had no investment in Transpower for 10 years. A number of major upgrades to Transpower—the national grid—could improve the efficiency of the system and reduce our vulnerabilities. What are they? We could do the DC upgrade. There has been a suggestion that the 24kb go up to 320kb which would reduce some of the existing constraints. None of that investment is occurring because there is no incentive to make the investment. It is not a case of too much market; it is a case of too much Government. We are talking about 100-percent Government-owned State-owned enterprises. Indeed 70 percent of the generators are in the Government’s hands—Genesis Mighty River Power Meridian Energy. Under the statements of corporate intent the Government can give clear directions to get the outcomes we need. But none of that is occurring. It is a case of too much Government and not enough market.