Eckhoff Gerrard: Debate on Crown Entities Public Organisations and State Enterprises — In Committee Speaker Recalled In Committee 
Eckhoff Gerrard: Debate on Crown Entities Public Organisations and State Enterprises — In Committee Speaker Recalled In Committee 
[Volume:617;Page:13268] 
GERRARD ECKHOFF (ACT) 
: 
 If I may I will preface my remarks with the observation that after sitting here for several hours I cannot help but note that many members especially Government members but also the odd speaker from this side of the Chamber seem to think that if the Government ran all the services in this country everything would be sweet. The health service is in a mess. The education service is in a mess. The fact that the odd service does work well like Landcorp for example seems to imply that if the Government ran everything everything in the country would be wonderful. However nothing could be further from the truth as is typified by the energy sector in this country. 
The electricity sector despite what some in this Chamber might say is heading for a crisis. We are not in that situation yet as I am sure the Minister would happily point out but the general consensus seems to be that that is exactly where we are heading. The energy sector is absolutely vital in this country and I want to include in my comments the role of Meridian Energy in that sector. 
Essentially all that this Government has generated in the electricity industry and the generation industry is uncertainty. Major upheavals occurred under Max Bradford. This Government has done nothing but add to the problem that was created when private property rights were taken from small generators—like the one I have some experience of Pioneer Generation in Central Otago. It was a marvellous little company owned by the populace of that region until it was forcibly sold. We were very unhappy with that. 
I now want to focus on the role of Meridian Energy especially as an Otago MP. I look forward to hearing a speech from David Parker on the very subject of Meridian Energy. As he is the constituent MP I am sure he will be taking a call on this most vital of industries especially in the south. Meridian Energy is not what the Government seems to paint it to be. I see that the financial review of Meridian Energy states that the company suffered significant losses on hedge contracts as a result of increased spot prices and is also experiencing increasing difficulty financing costs arising out of a $500 million bridging loan used for the acquisition of Southern Hydro—in Australia not in New Zealand. It is as if New Zealand does not have energy problems or a need for energy capacity. Well we all know that that is exactly what is needed in this country. We must have increased generation and we need it rapidly. 
Meridian Energy has stated that opportunities for company growth are limited within New Zealand and it has expanded into Australia. Who in his or her right mind would suggest that opportunities for growth in the energy industry are limited? Gracious me we are heading for a major shortage! We really should identify the impediments to growth in the industry. 
I suppose some might call the exercise that Meridian Energy went through over Project Aqua a futile exercise. However it is an example of what we really should be focusing on and the problems that were faced. Almost $100 million was spent by Meridian Energy on Project Aqua. A large portion of that $100 million is now totally wasted money. About $45 million was spent on the Resource Management Act process which is an outrageously large amount despite the fact that it was a $1.2 to $1.3 billion project. To have to spend $45 million on that process is in my view excessive. Meridian Energy spent the balance of that $100 million on acquiring land. Meridian Energy has now spent $100 million that it has had no particular use from. No private company could have afforded to do anything along those lines. Meridian Energy said: “Well look here we are being supported by the Government it doesn’t really matter.”