Ryan Bridge: The Taranaki LNG terminal is a good idea, depending on who you ask

This Government's running into similar problems Jacinda's one did on energy - they're getting too much 'official' advice and reports. 

The problem when you ask 'the experts' for advice on every thought that pops into your head, is that they tend to agree with it. And if they don't, you tend to ignore them.

And what does that tell you about the need for the advice in the first place? 

Latest case in point is the LNG terminal in Taranaki. A billion bucks. We'll be paying a levy on our power bills to fund it. 

Big announcement at the Beehive theatrette yesterday. 

The 'official advice' from MBIE and the rest was that this is the way to go. This will save us all, on average, apparently, $1 a week on electricity. 

If we're lucky. Because remember, as with all advice, there are caveats. The caveats are "depends on this" and "depends on that".

So, we've got an announcement and we hope for the best and this thing will be built, come hell or high water, bar a change of government, by 2027. 

When the wind doesn't blow and the sun doesn't shine, we'll import LNG and keep the lights on.

BUT. 

Last year we had the Frontier Economics report. Same issue but different set of 'advisors'. They're an independent global consultancy crowd and what they said was quite different. 

They told us it would basically be a dumb idea to build an import terminal because you've got a massive fixed cost spread over a relatively small amount of output, because you're only using this as a back-up. 

You can't sell an LNG terminal once you're finished with it. These particular advisors made the point that it's quite a specific piece of kit and could well turn it one of this country's biggest white elephant investments. 

Yet here we are less than a year later with a different set of advice and another vague plan. 

There's no doubt this country needs a plan to deal with energy security, but depending on who you ask, this is either brilliant or batshit.

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Episode Transcript

Speaker 1 (00:00):
This government's running into similar problems. I reckon is just
sind us wondered on energy. They're getting too much advice,
official advice, and too many reports. The problem when you
ask the experts for advice on every thought that pops
into your head is that they tend to agree with it,
and if they don't, you tend to ignore them. And
what does that tell you about the need for the
advice in the first place. The latest case in point

(00:22):
is this alng terminal in Tartanaki billion bucks. They reckon
it's going to cost we'll all be paying a levy
on our power bills to fund it, though they reckon
we'll save in the long run. Big announcement at the
Beehigh Theatery yesterday and the official advice from MB and
the rest was that this is the way to go.
This will save us all on average apparently fifty bucks

(00:43):
a year on electricity if we're lucky. Because remember, as
with all advice, there are caveats. The caveats are depends
on this, depends on that. So we've got an announcement.
We hope for the best and this thing will be built.
Come hello, high water bar A change in government by
twenty twenty seven. When the wind don't blow and the
sun don't shine, we will import ALLNG and keep the

(01:05):
lights on. That's the theory. But last year we had
the Frontier Economics Report, same issue, different set of advisors.
They were an independent global consultancy crowd looking at the
wider market. What they said about aling was quite different.
They told us it would basically be a dumb idea
to build an import terminal because you've got a massive
fixed cost that you then spread over a relatively small

(01:29):
amount of output because you're only using this as a backup,
and you can't sell an ALNG terminal once you've finished
with it and you have no need for it anymore.
These particular advisors made the point that it's quite a
specific piece of ketters and it could well turn into
one of this country's biggest white elephant investments. Yet here
we are less than a year later, with a different

(01:53):
set of advice and a different plan. There's no doubt
the country needs a plan to deal with energy security.
Everyone knows that. But depending on who you ask, this
is either brilliant or batshit. For more from early edition
with Ryan Bridge, listen live to news talks at b
from five am weekdays, or follow the podcast on iHeartRadio