Chauvel Charles: Questions for Oral Answer — Questions to Ministers Questions to Members 
Chauvel Charles: Questions for Oral Answer — Questions to Ministers Questions to Members 
[Volume:642;Page:12351] 
9.  
CHARLES CHAUVEL (Labour) 
 to the  
Minister of Energy 
: Is he confident that there will be sufficient renewable energy to meet New Zealand’s demand for electricity over the next 10 years? 
Hon DAVID PARKER (Minister of Energy) 
: 
 Yes. We know our renewables are affordable. The Energy Strategy confirms the Government’s view that all new generation should be renewable except to the extent necessary to ensure security of supply. We already have 633 megawatts of geothermal electricity announced consented or in process. Geothermal energy provides great baseload electricity. To put that in context demand grows by about 150 megawatts a year. Contact Energy today has announced 650 megawatts of wind power in the North Island and a 100-megawatt gas peaking plant. If we add up the number of renewable projects that have been announced or are in the consenting process we see that it comes to a staggering 3311 megawatts. That is more than enough for 10 years. New Zealand does have a competitive advantage in renewables and we will seize that opportunity. 
Charles Chauvel 
: Can the Minister tell the House what measures the Government is taking to support its target of 90 percent renewable electricity generation? 
Hon DAVID PARKER 
: To aid the transition to more renewables we have sent a message to State-owned enterprises that we do not want more baseload thermal and also to that effect we are considering an amendment to the Electricity Act. Together with this we have a national policy statement coming on renewables under the Resource Management Act and we have said we are going to use the call-in powers under the Act. Through this we will achieve our target of 90 percent renewables by 2025. I repeat I have no doubt that with good Government leadership here we will achieve this and New Zealand will take advantage of what is our natural endowment. 
Gerry Brownlee 
: Why in justifying the Government’s moratorium on new thermal generation did the Minister tell the  
New Zealand Herald 
 that “It’s a fiction that building more thermal power stations reduces your long-term emissions” when only 2 months ago he defended the construction of Genesis Energy’s new thermal E3P plant by saying: “In fact E3P is likely to back off Huntly and reduce and lower emissions.”; why would that not be the case for the proposals in Rodney that Genesis had and would that not have meant that Huntly would have backed off even further meaning our emissions from electrical generation would have been further lowered? 
Hon DAVID PARKER 
: I have never ever said that building more thermal reduces one’s total emissions long term; it does not. New— 
Hon Dr Nick Smith 
: You did say that! 
Hon DAVID PARKER 
: I did not Dr Smith. I was very careful about what I said. What it does do is year on year decrease our emissions because of course in the short term we replace coal with gas. But if we build more thermal it lasts for decades. It actually results in higher emissions than if we build renewables instead— 
Hon Dr Nick Smith 
: You’ve changed your tune. 
Hon DAVID PARKER 
: No I have not Dr Smith. 
Peter Brown 
: With the advent of a “cap and trade” emissions system and in order to encourage renewable energy is it possible that customers of Genesis Energy in the future will pay more for their power simply because Genesis Energy generates a significant percentage of its power from coal and gas? 
Hon DAVID PARKER 
: No it is not because the market works to dispatch all energy at the same price. The market price is set by the marginal cost of electricity generation; so Genesis Energy customers or indeed customers of any company will not be disadvantaged in particular. 
Gerry Brownlee 
: Why did the Minister ignore the advice of the Ministry for Economic Development’s energy division which said in the analysis document that accompanied the New Zealand Energy Strategy that prolonged deferment or prohibition on the development of thermal energy plants could see existing very very dirty plants have a prolonged life with refits that otherwise would not have happened thus failing to mitigate the very heavy emission we have from the electricity sector? 
Hon DAVID PARKER 
: The ministry and the member do make a valid point. That is one of the issues we have to take into account—whether if we have a ban on more baseload thermal our old thermal runs longer. There is an argument that it does but that argument is outweighed by the reality that in the case of New Zealand we have abundant sources of renewables that are available at an affordable price that will reduce emissions more by replacing old thermal with renewables rather than with more efficient thermal.