Copeland Gordon: Urgent Debates — Electricity Industry 
Copeland Gordon: Urgent Debates — Electricity Industry 
[Volume:608;Page:5850] 
GORDON COPELAND (United Future) 
: 
 It would be remiss of me to begin without taking a moment to congratulate the Minister of Energy on at long last taking some action on the very urgent problems that face this country in relation to electricity. For some years now we have had an unregulated electricity market and we had piously hoped that an invisible hand would be there to prevent this kind of situation from arising. As Peter Brown pointed out one cannot have a self-governing market that is at one and the same time a competitive market. I am therefore very very pleased that we will at last have a visible hand: somebody who will actually be in charge of this extremely important sector. I therefore congratulate the Minister on the announcement that the Electricity Commission will be established. 
I also believe that the Minister and the Government are right in putting before the people of New Zealand a soundly based and well-thought-through scheme to put aside reserve electricity generation capacity for those years when the rain does not fall and we have extremely dry conditions. It is all very well to criticise that action but we need to come up with a solution by way of an alternative. I think the suggestion that has been put forward by the Government is a sensible one. It is compatible too with the free-market nature of the industry. I think people have thought simplistically that there is only one side to the issue—that we will just build new reserve capacity take it out of the market and set it to one side so that it will be there when required. That is partly valid—it is exactly what the Americans for example have done in relation to their strategic oil reserves. But in fact the issue is far more complex than that. Rod Donald mentioned the demand side and that will also feature in this scheme because as I understand it New Zealanders are being asked to buy an insurance premium to set aside reserve generating capacity. I think that is a very very sensible thing to do. 
However I want to say immediately that my vision of the future of this country is very different from that of the previous speaker Rod Donald of the Green Party. I believe that this country’s social and economic future is heavily dependent on our being able to continue to provide efficient low-cost and reliable energy not only to our households but also to our industries. Every facet of our life—be it cellphones computers or whatever—is dependent on electricity. We simply need the stuff to keep our society functioning and our economy growing. For example we need $3 billion of new investment in the wood processing industry and we cannot process that wood here without a reliable source of energy through electricity. It is therefore a real concern to me—as I know it is to every New Zealander—that we are in this unfortunate crisis right now. 
We can sit here and apportion blame for the crisis and in the eyes of New Zealanders blame will rest first with the Government. New Zealanders do elect Governments to foresee such problems and to solve them in advance yet that clearly has not happened here. Some of course will then point the bone—as happened today—at Genesis Energy and say it should have had its stockpile of coal in place so that we did not have to import the jolly stuff. I am sure that Genesis Energy will point the bone at Solid Energy and say it would not give Genesis Energy the coal at the price it wanted to pay. Putting all that aside the bottom line is that New Zealanders are angry and upset. They are asking how on earth we have got into this situation. 
In every crisis there is a bit of a silver lining to the cloud and in this case the crisis has made people focus on some issues that we have been ignoring. One of them is the reserve electricity generation that we have already mentioned and I am pleased that action has been taken about that. The other thing is just to ask ourselves some big-picture questions. One of those big-picture questions must surely be why it is that in a nation with many lakes and rivers and much hydro capacity we have not for many years been building new hydro schemes. That has not applied just under this present Government; it also extends back to the previous National-led Government and probably to the Government before that. We have put in place a whole lot of self-imposed rules to stop hydro schemes from being developed. 
People have gone to the Department of Conservation with hydro scheme proposals around the Rotorua lakes the Mohaka River the Motu River the Raukokere River the Karamea River the Ngakawau River the Arnold River and the Beaumont area on the Clutha River in Central Otago. Those people have all basically said they had a good scheme that should be allowed to go ahead because it would have fantastic environmental outcomes. They have been consistently told they could not go ahead because the schemes involved the conservation estate. Some people tell me that as many as 38 potential schemes have not gone ahead because of the way in which the Conservation Act has been set up. We need to understand what has caused that problem because it is a systemic problem that has cost this country dearly. 
Instead of taking advantage of the natural resource that we have in hydro electricity we have foolishly put a barrier in the way so that we cannot use our own water. The simple problem is this: under the Conservation Act the Minister of Conservation is set up to be an advocate for conservation values. That is a well-thought-through proper function for a Minister of the Crown to have. Like every other New Zealander I appreciate the wonderful environment that this country has and I do not want to see our conservation estate damaged either. But if the Minister is an advocate we have to ask ourselves whom he advocates to. Normally the function of an advocate is to put a case to a judge who will look at the facts on both sides of an argument and come up with an adjudication that is in the interests of the nation. That is what is lacking under our present system. 
We have no ability to take hydro scheme proposals to an independent judge—be it the Environment Court or a specially appointed arbitrator; it does not matter which it is. We are not able to take those proposals forward and argue through on the one hand the conservation values and on the other hand the need of this nation for efficient low-cost renewable and sustainable electricity. We desperately need to make the very most of this country’s comparative competitive advantages and electricity could and should be one of those for New Zealand. We really have only ourselves to blame for being in this situation. We have to get that right. United Future is therefore calling upon the Government to urgently undertake a review of the Conservation Act and to address the problem to which I am alluding. 
In many of these situations we can have genuine win-win situations. Yes we can have a hydro dam and we can also have a lake that is good for recreation. We can put an island in the lake and make it a sanctuary for birdlife. We can make sure that we put other pieces of land into the conservation estate to compensate for any loss of forests and so on and so forth. That is not really rocket science. 
The other thing that we need to recognise—and I asked the Minister a question about this today but I am not sure that he understood the question—is that the Electricity Commission should also be charged with the task of minimising dry-risk conditions. I believe that that should be one of its basic terms of reference because there are ways of doing that. First of all we have already been told in this House that the forecast is for more rain on the western than on the eastern side of the main divide in the South Island. One therefore does not have to be a rocket scientist to figure out that we need to develop more hydro capacity on the west which could offset the occurrence of a dry year when it kicks in. The second thing that we are overlooking is wind. New Zealand has enormous wind capacity. Some people estimate that we could have many many thousands of megawatts of wind generation in this country. I heard my colleague Peter Brown talk about visual pollution from windmills—well heck there are plenty of places where we could build them where we would not even see the jolly things. Wind is a free sustainable and renewable energy source. In my view we should have hydro and wind generation at the top of the pile. 
I am not opposed to burning coal to make electricity but it is a non-renewable fuel. It emits carbon dioxide into the atmosphere and it could well be more expensive than wind or hydro. So what about some common sense and logic? We could have a national goal of saying that we want renewable sustainable low-cost electricity for the future of this nation and all parties of this Parliament could collectively focus on coming up with some answers. I think that would be the only thing that would now mitigate the anger that New Zealanders feel about this matter.