Copeland Gordon: Third Readings 
Copeland Gordon: Third Readings 
[Volume:620;Page:16126] 
GORDON COPELAND (United Future) 
: 
 The principal purpose of the part of this legislation that deals with electricity is to improve the security and supply of electricity. On that subject I draw to the House’s attention concerns about the implications for New Zealand’s electricity supply and for our economy in general flowing from the May 2004 decision of the Environment Court concerning the renewal of the Tongariro power development consents. As is now well known the court has reduced the term of those consents from the requested 35 years to a mere 10 years because of its inability to make judgments on the negative effects of the power scheme on Maori cultural and spiritual values as required by the Resource Management Act. That is a matter of the greatest national importance. The Tongariro power scheme incorporates two major hydroelectricity schemes. The water is then discharged into the Tongariro River flows into Lake Taupo and then flows down through a further eight dams in the Waikato River until it reaches the ocean. That is a total of 10 hydro schemes in all. 
The decision means that the generating capacity of the entire system will be quite significantly reduced should the consents finally be confirmed on the condition that the diversion of water from the upper reaches of the Whanganui River and a number of other rivers sourced from Mount Ruapehu is brought to an end. Even worse is the signal that the decision sends to the business community in relation to new investments in New Zealand - based hydroelectricity and other electricity generating schemes. For hydroelectricity schemes the business community needs a 35-year-plus investment horizon and a certainty of process or otherwise investments simply will not happen. Potentially the damage flowing from the decision is such as to relegate New Zealand’s international reputation as an investment destination to a highly negative if not a complete nutcase status. It is important therefore that we examine that extraordinary decision and its effects. 
The decision itself is clearly set out in the 134-page judgment and is therefore a matter of record. The key finding is in paragraph 472 which states “In evaluating the various matters that we are required to under the Act”—that is the Resource Management Act—“and evaluating the matters on which evidence was presented we have had some difficulty in weighing the metaphysical matters against the physical and scientific matters. Notwithstanding this difficulty the Act nevertheless requires us to do so. In so doing we have had to make a value judgment which reflects what is in our view the relative importance of these matters and the relevant magnitude of the various matters.” The Tongariro power project as a result is left in limbo. The court stated that it could not make a determination concerning the metaphysical matters but at the same time it was obliged by the Act not to ignore them—a classic no-win situation. Accordingly the Environment Court has just passed the matter back to the three iwi concerned—seven other iwi chose not to contest the consents—and to Genesis Power Ltd and has effectively said to them that it hopes they can get together and sort the matter out over the next 10 years. 
Genesis Power is appealing that decision to the High Court—and it should do so because it is not the function of our courts to adjudicate on the spiritual and the metaphysical. That is something that I understand the National Party is also in agreement with. For the moment we will have to await the outcome of the Genesis Power appeal. In the meantime some people are saying that the Environment Court has got it completely wrong in the emphasis that it has placed on the metaphysical aspect. They argue that the purposes and principles under Part 2 of the Resource Management Act are paramount and that the references there are only to the sustainable management of natural and physical resources. I hope for the sake of New Zealand and the future of its electricity supply that that view will prevail and that the decision of the Environment Court is overturned by the High Court. However if the decision is upheld then the Government will need to act and to act swiftly to amend the Resource Management Act so that references to spiritual values are removed. 
I need to be clear about one matter at this point: I am committed to defending and will defend the principle of religious freedom. It is a fundamental right in our society—including the right to change one’s religion. I need to say that because I want to emphasise it is not my intention in this speech to attack traditional Maori spiritual beliefs— 
Brian Connell 
: I raise a point of order Madam Speaker. I am reluctant to interrupt the member but by my reckoning he is now 6 or 7 minutes into his speech and I do not recall him having mentioned this legislation once. I would ask you to direct him to address his attention to the legislation. 
GORDON COPELAND 
: Speaking to the point of order Madam Speaker I started my speech by quoting the principal purpose of this legislation. I quoted it as being to improve the security and supply of electricity. I am speaking to that matter. 
Madam DEPUTY SPEAKER 
: The member has been speaking to the supply matter. 
GORDON COPELAND 
: I was saying that I do not want to attack traditional Maori spiritual beliefs. In matters concerning religion my attitude is one of respect and dialogue. I simply say that if the decision of the Environment Court in this case is upheld then Parliament must act both to ensure the future of the 10 hydro schemes in question and to repair the damage done to New Zealand’s international reputation as a credible investment destination. 
The reality is that we do compete in a worldwide marketplace for scarce capital resources. United Future believes strongly that our future economic prosperity will be dependent on New Zealand remaining a destination of choice for international investment. I agree with the point which was strongly made by the Hon Ken Shirley that electricity must remain cheap in New Zealand—as cheap as we can possibly make it. All of us should apply our minds towards ensuring that that happens because it is clearly a comparative competitive advantage and as Ken Shirley has pointed out we do compete on the world stage. Dr Michael Cullen was quoted in this House a few weeks ago as saying that the purpose of the current Resource Management Act review is to provide greater certainty. I agree with that objective but should it become necessary we will need to follow through with further amendments to the Act in order to ensure that that becomes a reality. Just saying it is so does not make it so. 
I turn briefly to the question of the major investment that Transpower needs to make to upgrade the national electricity distribution system. I referred to that briefly in my second reading speech on the Electricity and Gas Industries Bill. 
Brian Connell 
: Do you support the legislation? 
GORDON COPELAND 
: I will come to that in a moment for the benefit of the member. The problem that needs to be solved is the fact as others have said that we literally need billions of dollars potentially of investment in the national electricity grid. Because it has been neglected for 40 years we now have a major major upgrade ahead of us and I think that all of us in this House would be in agreement on that point. The question therefore is how to get that system upgraded while keeping the cost of electricity as low as possible in order to achieve the economic goals that I have mentioned of ensuring that we retain a comparative competitive advantage relative to other players in the world. 
 In my view the way to do that is that the State needs to have a hand in borrowing the money to do it. Then I believe it needs to endeavour to repay the funds borrowed over at least 35 years or so. It has to be an intergenerational borrowing because the upgrade of the power grid will last for at least another 40 years—so 35 years for repayment is conservative. Then I believe we should recover from the electricity consumers of this nation just the amount that we actually need to service the interest and debt repayments on those loans so that we can keep the price of electricity as low as possible. I used the analogy in my second reading speech of our roading system. We do not actually attempt to get say a 10 percent real rate of return on the investment in our roading system. We all agree that roading is a necessary part of our total integrated economy and therefore that it is in the public interest and the common good to provide it as efficiently as possible. I believe that exactly the same thing applies to the upgrading of the transmission grid. 
I can also say that to some extent I am in agreement with previous speakers from the ACT and National parties on other points too. I think we need to take the step of getting rid of the current separation of the electricity sector into different segments. I do not think that has worked and I think the time will come—and Mark Peck mentioned this also in his speech—when we will have to revisit that matter. 
This legislation is not perfect but nevertheless it is a significant step forward in what had become a situation that was quite frankly out of control. It was a mess created by the Max Bradford reforms which obviously from any point of view whether one is a socialist or a free marketeer have not worked. At least this legislation takes a step in the right direction towards fixing that. Therefore I am pleased to signal United Future’s continuing support for these bills.