Kerre Woodham: Reverse the ban, but is anyone interested in coming here?

Yesterday the Prime Minister announced what we all know to be true, that we have an energy security crisis.  

We seem to have been having them for a while now, every winter there are concerns about brownouts. The Electricity Authority put it into plain English on their website - winter sees the highest demand for electricity, obviously, also when it's unseasonably cold in autumn or spring, that can cause high demand periods. The winter peak capacity reflects the ability of the electricity system to meet high winter demand. So typically, solar doesn't produce electricity during peak demand periods in winter because it's dark. Wind generation, which is 10% of New Zealand's electricity generation capacity and growing, isn't reliable because, who knew, but cool temperatures bring low wind speeds. So solar is out, wind generation is out during winter.  

That leaves hydro, geothermal, and thermal generation to provide the bulk of electricity during high demand periods. Geothermal already runs at near full capacity, so only thermal and hydro can ramp up and down to meet the winter peaks. But when you have a perfect storm, as the Prime Minister called it yesterday, winter peak capacity and a dry year, when low rainfall sees the hydro lake levels fall below average for an extended period of time, hydropower can't ramp up. There's no water there, they can’t push the turbines.  

So then we have to burn coal. Coal use soared in 2021 to the highest in about 30 odd years. Then coal use plummeted in 2022, reflecting the vagaries of the weather and the fact that some more renewables were coming online. But while solar and wind can store some excess energy using batteries, that's limited to only a few hours' worth of electricity, and isn't enough to manage a situation where rainfall is below average for weeks to months. So there are all sorts of solutions being explored to try and make up for those dry years during winter.  

I mean it makes perfect sense, doesn't it? We've known about this for a very, very long time. We are dependent on rainfall during winter, we use more electricity during winter. If there is a dry year, we have to get the energy from somewhere, and right now our choices are coal, coal, and coal. So we are exploring the renewables, but why are we still exploring them when we've known for a very, very long time that people are concerned about climate change, that the world is moving to renewables. Why are we still exploring them?  

Chris Luxon says while we're exploring the renewables, we need to reverse the ban on offshore oil and gas exploration and take urgent steps to bring liquefied natural gas into the country to offset the energy shortages because our exporters need certainty, they need to know that the factories will keep running so they can sell our products, so we can make some money. Forgive me if this is all very 101 but this is what we need to know: we need to know that when we turn on the switch at the factory, the power will come on. And if we're concerned about burning coal, we need to have something to replace it. And we don't have anything secure yet, so the Prime Minister has said let's bring in liquefied natural gas, which other countries use to sort of level out electricity supply. So he's also looking at the ban on offshore oil and gas exploration being reversed. That's been in place since Labour came to power in 2018 outside of onshore Taranaki.  

The opposition parties, in a shocking revelation, are dead against the importation of liquefied natural gas, seeing it as just another fossil fuel. But we need certainty and security so what's their solution? There are a number of questions though. We may be open for exploration but would oil and gas companies want to come here? Especially if Labour goes ‘no, dead against it, we're not having a bar of it, fossil fuels are dead and gone’. So why would you come here, given the electoral cycle? Also, in 2012, Petrobras, the Brazilian oil company that came here to do a little bit of a looksie to see if they could make money out of exploiting oil and gas here, they pulled out. They got the license and the permit in 2010, they pulled out in 2012 because they said there weren't enough indicators for them to continue. All very well to reverse the ban, but would people come here?  

And on the renewables, when you have the four big generation and retail power companies recording their largest single year rise in earnings this year, what's that all about? If we are the majority shareholders, which we are, and we are in the middle of an energy security crisis, then why can't we push them into spending more of their money, more of their profits, into the renewables? Fast track it, get them cracking.   

This was along the lines of what Mike Hosking asked Christopher Luxon, the Prime Minist

Episode Transcript

Speaker 1 (00:06):
You're listening to the carrywood of Morning's podcast from Newstalk
sed B.

Speaker 2 (00:11):
Yesterday, the Prime Minister announced what we all know to
be true, that we have an energy security crisis. Seems
we have been having them for a while now. Every
winter there are concerns about brownouts. The Electricity Authority put
it into plain English on their website. Winter sees the
highest demand for electricity, obviously, also when it's on unseasonably

(00:35):
cold in autumn or spring that can cause high demand periods.
The winter peak capacity reflects the ability of the electricity
system to meet high winter demand. So typically solar doesn't
produce electricity during peak demand periods in winter because it's dark.

(00:57):
Wind generation, which is ten percent of New Zealand's electricity
generation capacity and growing isn't reliable because who knew, but
cool temperaure bring low wind speeds, so sol is out.
Wind generation is out during winter. That leaves hydro, geo,
thermal and thermal generation to provide the bulk of electricity

(01:19):
during high demand periods. Geothermal already runs it near full capacity,
so only thermal and hydro can ramp up and down
to meet the winter peaks. But when you have a
perfect storm, as the Prime Minister called it yesterday, Winter
peak capacity and a dry year when low rainfall sees
the hydro lake levels fall below average for an extended

(01:41):
period of time. Hydro power can't ramp up, there's no
water there, we can't push the turbines, so then we
have to burn coal. Coal use soward in twenty twenty
one to the highest in about thirty odd years. Then
coal use plummeted in twenty twenty two, reflecting the vagaries
of the weather and the fact that some more renewables

(02:03):
were coming online. But while solar and wind can store
some excess energy using batteries, that's limited to only a
few hours worth of electricity and isn't enough to manage
a situation where rainfall is below average for weeks two months.
So there are all sorts of solutions being explored to

(02:25):
try and make up for those dry years during winter.
I mean, it makes perfect sense, doesn't it. We've known
about this for a very very long time. We are
dependent on rainfall during winter. We use more electricity during winter.
If there is a dry year, we have to get
the energy from somewhere, and right now our choices are coal, coal,

(02:45):
and coal so we're exploring the renewables, But why are
we still exploring them when we've known for a very
very long time that people are concerned about climate change,
that the world is moving to renewables, So why we're

(03:06):
still exploring them. Chris Luxon says, while we're exploring the renewables,
we need to reverse the ban on offshore oil and
gas exploration and take urgent steps to bring liquefied natural
gas into the country to offset the energy shortages, because
our exporters need certainty. They need to know that the

(03:27):
factories will keep running so they can sell our products
so we can make some money. Forgive me if this
is all very one O one, but you know, this
is what we need to know. We need to know
that when we turn on the switch at the factory,
the power will come on. And if we're concerned about

(03:49):
burning coal, we need to have something to replace it,
and we don't have anything secure yet. So the Prime
Minister said, let's bring in liquefied natural gas, which other
countries use to sort of level out electricity supply. Also
looking at the ban on offshore oil and gas or

(04:09):
exploration being reversed that's been in place since Labour came
to power in twenty eighteen outside of on shore Tartanaki.
So the opposition parties na shocking revelation, are dared against
the importation of liquefied natural gas, seeing it as just
another fossil fuel. But we need certainty insecurity, So what's

(04:30):
their solution? There are a number of questions. Though we
may be open for exploration, but would oil and gas
companies want to come here, especially if labor goes no
dead against it. We're not having a bar of it.
Fossil fuels are dead and gone, so why would you

(04:51):
come here given the electoral cycle. Also in twenty twelve, Petrobrass,
the Brazilian oil company that came here to do a
little bit of a LuxI to see if they could
make money out of exploiting oil and gas here, they
pulled out. They got the license and the permit in
twenty ten. They pulled out in twenty twelve because they

(05:12):
said there weren't enough indicators for them to continue. So
you know, all very well to reverse the band, but
would people come here and on the renewables when you
have the four big generation and retail power companies recording
their largest single year rise in earnings this year. What's

(05:33):
that all about. Shouldn't they be running if we are
the majority shareholders, which we are, I mean admittedly fifty
one percent in Genesis, Mercury and Meridian more in contact.
But if we are the majority shareholders and we are
in the middle of an energy security crisis, then why
can't we push them into spending more of their money,

(05:57):
more of their profits into the renewables fast tracking keept
them cracking. This was along the lines of what Mike
Asking asked Christopher Luxen, the Prime Minister, when he was
on this morning.

Speaker 3 (06:12):
Yeah. Also, and I am on their level of profitability,
but they also need confidence to invest because we want
them and I know they will huge amounts of capital
on actually doubling that renewable electricity in GS, thermal and
wind and solar and all the stuff that needs to happen. So,
as I said, it is about making sure that we're
giving people confidence. And that's what the announcement was about yesterday,

(06:33):
was to say to many of those international investors who
want to do the offshore engineering solution for LNG importation,
who want to do exploration for gas, who actually want
to know that I can go a huge number of
the projects that Chris Bishop's looking at on the fast
track approvals that people who want to do renewable projects.
But actually the consenting times insane. It's absolutely insane. So
let's just change the role. Extend the consents of all

(06:56):
that good stuff.

Speaker 2 (06:57):
Yeah. See, I would as a majority shareholder, and I
know normally you wouldn't interfere in the running of a company. No,
put those millions collectively of dollars of profits into renewables
right now, and we'll make it easier as the government
to fast track those projects you want in place. Chris
Hipkins says, there is already consented renewable electricity that could

(07:21):
be built right now, but these big gent tailors are
choosing not to build them because it's in their commercial
interest to keep energy scarce and maximize profits, which would
be economic sabotage if that is true, and you'd have
to take anything I suppose that politicians is with a
grain of salt. But if they are already consented, why

(07:42):
aren't they being built now? I have more questions than
I have answers for you, So I am looking to
you for the answers. Those of you who know more
than I, but we know we have an energy security crisis.
Chris Hipkins says that there are consents in place. We
could get cracking if the gent tailors wanted to. They
have made squillions, so it's not like they're wondering where

(08:04):
their X buck is coming from. They've made millions from us.
We're the ones paying the price every single time for
decisions made by these big companies and by governments. So
a get cracking with the renewables. Government, do your work
by fast tracking these already consented projects. They need to start.

(08:25):
The gentailors need to start on those any that are
still waiting for consents, we fast track them oil and
gas exploration. Sure, reverse the band, but is anybody interested
in coming here?

Speaker 1 (08:36):
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