Fitzsimons Jeanette: Energy (Fuels Levies and References) Biofuel Obligation Repeal Bill — First Reading Second Reading 
Fitzsimons Jeanette: Energy (Fuels Levies and References) Biofuel Obligation Repeal Bill — First Reading Second Reading 
[Volume:651;Page:784] 
JEANETTE FITZSIMONS (Co-Leader—Green) 
: 
 Well it seems that all National’s friends have deserted it except ACT. The Maori Party is not voting for this silly Energy (Fuels Levies and References) Biofuel Obligation Repeal Bill and Peter Dunne is not voting for this silly bill. It is not a popular bill and it is squeaking through with a narrow majority. 
This is a second reading debate. Normally we would be debating what happened at the select committee and talking about all the people who came to talk about the effects of this legislation on them but we cannot do that so it is sounding like a very repetitive debate. I will talk just a little bit wider and look at where this bill sits because it is not just about biofuels. 
This bill is part of an extreme ideological position that says regulation is always wrong. Whether it is about energy efficiency standards for lights and hot water about a renewable electricity preference or about biofuels regulation—according to this Government—is always wrong. In fact this Government has actually abdicated its power to govern in favour of a Mr Smith and I do not mean the Dr Smith sitting opposite. We have two Smiths already in National but that is not enough. National has co-opted Mr Adam Smith as well to run the Government for it and the mantra is freedom choice and the market. Of course we all support freedom choice and the market but markets do not necessarily deliver the outcomes we want. 
Public policy usually aims to serve a purpose. Otherwise we would not bother having any. It has a goal. The goals of the biofuel legislation were two: firstly to reduce by a little bit our carbon dioxide emissions in order to start meeting climate change obligations and secondly to start preparing in a small way for the day when oil becomes unaffordable and then unavailable. That is about energy security which is a term I seem to have heard an awful lot about from the present Minister of Energy and Resources Gerry Brownlee but with this bill he is actually moving in the opposite direction. 
I hope Gerry Brownlee is around the next time an oil tanker headed for New Zealand turns round in mid-ocean and goes somewhere else. Some members may remember as I do when that happened in 1979. During the false oil crisis if you like that happened in the 1970s an oil tanker simply did not turn up at Marsden Point and that led to all kinds of restrictions in New Zealand. That was a very temporary situation because of an action taken by the Organization of Petroleum Exporting Countries. When it happens next time it will be part of a permanent situation of oil being very expensive and ultimately very much less available. 
I hope Gerry Brownlee is around to see that when it happens and I hope I am around to see his face when he realises that it would have been possible if he had left the law as it was for New Zealand to have a small local industry making sustainable diesel so that we could still run our emergency services and get food to the supermarket—because we will not be able to do that with electric cars. If we do not build an industry in New Zealand we can forget the idea that when oil becomes too expensive overseas we will be able to just import biofuel. If we cannot import oil then we will not be able to import biofuel. This is about energy security and the Government is opposed to it. 
Many countries overseas use sales obligations to meet goals of energy efficiency. They put sales obligations on the power companies to invest in energy efficiency renewable energy and biofuels. This is not rocket science. A myth is being perpetuated that regulation and mandatory standards are somehow mutually exclusive. That is almost never the case. Biofuel producers will still have to compete to supply the obligation. The oil companies will still have choice as to whom they buy from and if people try to price racket they simply will not have a market for their product. 
Mandatory standards have a number of other advantages. The first one is that it creates some certainty and business likes nothing better than it likes certainty when it is looking at where to invest its money. 
Hon Judith Collins 
: It really likes the National Government. 
JEANETTE FITZSIMONS 
: The National Government is creating anything but certainty and we are already seeing business go down the drain because of that. 
If we are looking at setting up a biofuel industry in New Zealand we are going to ask whether the market will be a stable market or a stop-go market. Producers would still have to be competitive to access that market but they need to know it will be there. If we want innovation investment and good science if we want biofuels produced from algae to flourish in the future when the science is ready and if we want ethanol produced from wood wastes in New Zealand—all totally sustainable and all made from New Zealand resources—then we need certainty for investment and this bill is taking that away. Mr Brownlee says that because Fonterra sends 22 million litres of ethanol now to Gull Petroleum it proves that there is a market now and that it can be increased many times over with no market certainty. Well I do not know where that comes from but clearly the fact that one contract exists does not mean there is an unlimited ability to expand. 
The next point is that if we want choice we can have it only if we have information. How are consumers to know whether they are buying biofuel or petroleum or if they are buying biofuel where it comes from and whether it is sustainable? How can consumers possibly exercise choice in this situation? Even the energy star labels on appliances are read only by the committed and that is why we needed minimum energy performance standards. 
Consumers’ day-to-day choices simply cannot meet long-term strategic goals. We need investment in infrastructure to meet long-term strategic goals and we do not get investment in infrastructure with a stop-go market and the daily fluctuating choices of consumers. How can consumers choose renewable electricity? They pretty much cannot and that is why we put an obligation on the power companies to build something that is renewable. How can consumers choose the best-performing lights when the best-performing lights are not even imported into New Zealand? Our market is dominated by junk light bulbs because it is not big enough for the good ones and they simply do not come in. 
Pricing and subsidies are often much more expensive than standards. In this case a tax exemption for biofuels will cost the taxpayers not the fuel users. I think that is an interesting distinction. A mandatory standard if it costs at all costs the fuel users in proportion to the amount of fuel they use. A tax exemption has the taxpayers subsidising the fuel users. I want to know why the cyclist the public transport user and the person with a small car should subsidise those with gas guzzlers because that is what this repeal bill does. 
National has a very inconsistent approach to subsidies. National subsidies? I thought National was not in favour of subsidies but it is proposing to remove a mandatory standard and replace it with subsidies. Phil Heatley said in the  
Herald on Sunday 
 that National was cancelling the green homes insulation fund because it would not tax people to pay for their neighbour’s insulation. Yet it is quite happy to tax people to pay for their neighbour’s health care when they have more severe asthma attacks because the home is uninsulated. Where are the logic and the consistency in that? Now we find that National is prepared to tax people to pay for their neighbour’s fuel. 
The principle seems to be that subsidies are OK when they go to big business but they are not OK when they go to ordinary people. The end point of this ideology is that we would abolish the building code because people can choose whether they want their houses to stand up or to fall down and whether they want them to be energy efficient. We would abolish driving on the left because people can choose whether they want to run into people. We would abolish regulations for hazardous substances for food safety for seatbelts for fishing quotas and for the Standing Orders in the House because on all of those matters the consumers could actually choose to run things the way they want to and we could get rid of mandatory things.