Renewables are the new oil

A National government would support climate action by streamlining the consent process for renewable electricity generation projects, Leader of the Opposition Christopher Luxon told an Institute of Directors Chapter Zero New Zealand breakfast on 31 March.

Luxon said National would set a one-year limit on the consent process for new projects, and scrap consenting requirements to upgrade existing electricity assets.

Renewable energy is “the new oil”, he told a crowd of around 400 New Zealand directors.

The moves come as part of a new policy proposal under the banner “electrify New Zealand”. Luxon says the programme will make it easier for business to invest in windfarms or solar farms, while simplifying the process of upgrading current electricity generation infrastructure.

This could be a key move towards achieving New Zealand’s carbon net zero targets, he says.

“It’s not enough to turn our existing electricity generation to renewables. We need to convert entire swathes of the economy from fossil fuels to clean electricity. That means doubling the amount of renewable electricity we produce,” Luxon says.

“If we get this right, Electrify NZ will take New Zealand about a third of the way to meeting our net zero ambition.”

The party’s “electrify New Zealand” proposals have two main aims. The first is to “turbo-charge” wind, geothermal and solar power projects, Luxon said, while the second is to “unleash” investment in new electricity transmission and distribution infrastructure.

New projects would be guaranteed a maximum one-year limit for consent decisions, with consents to last for 35 years. Upgrading existing transmission and distribution infrastructure would no longer require resource consent.

Luxon plans to issue a National Policy Statement for Renewable Electricity Generation and introduce National Environment Standards for each type of renewable generation. This will make it clear to applicants whether or not their plans for renewable generation will be consented under the proposals.

“As long as an application complies with the strict standards, including restrictions on where a solar or wind farm can be built, councils can set conditions but, in most cases, will not be able to decline it.

“We’re confident these changes will make it much easier to get a renewable project consented and importantly unleash the $30 billion investment the private sector wants to make in renewables over the next 25 years.”

Assuming that renewable electricity comes on stream, our transmission system will need to be upgraded in order to distribute it to where it is needed, he says.

National plans to introduce a National Policy Statement for Distribution so, in most cases, resource consents won’t be needed for upgrades to local electricity infrastructure like power poles, transformers and substations.

“New Zealand needs more than $30 billion of investment in transmission and local lines this decade, according to a recent estimate. A significant part of that investment will be upgrades to existing lines.”

Luxon also pledged an updated Statement for Transmission that makes clear “within limits” that no consents are required for upgrades.

Changes are also mooted for the Commerce Act, which regulates the pricing of energy transmission.

“Our electricity lines companies are natural monopolies, so their investments, pricing and returns are regulated by the Commerce Commission. The system generally works well, but the rules are now 15 years old. They were written in, and for, a different era,” Luxon says.

“We will update the Commerce Act and associated regulations to provide greater certainty around cost recovery for regulated infrastructure.”