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New Zealand

New Zealand

One huge drought and wind would rule

New Zealand's environment groups have welcomed the country's ratification of the Kyoto Protocol, but warn against complacency when it comes to meeting emissions reduction goals, or even meeting electricity demand. The country is facing a loss of gas reserves and a decreasing availability of hydro-generation sites. It is a scenario that has the country's tiny wind sector hoping for a rosier future.

Gas fields are running dry and hydro sites nearly all gone, making New Zealand's wind resource the obvious choice for meeting electricity shortfalls without endangering Kyoto Protocol commitments. The government, however, has a blind spot

New Zealand's environment groups have welcomed the country's ratification of the Kyoto Protocol, but warn against complacency when it comes to meeting emissions reduction goals, or even meeting electricity demand. The country is facing a loss of gas reserves and a decreasing availability of hydro-generation sites. It is a scenario that has the country's tiny wind sector hoping for a rosier future.

"Kyoto really is symbolic, giving us a direction to go in...but it doesn't lay out the path itself," says Greenpeace New Zealand's Robbie Kelman. He stresses the need for the country's energy policy to move beyond Kyoto in an organised fashion. "The government is failing to see the connection between New Zealand's future energy supply and climate change policy. The two are intimately linked," he says, adding that the recently released climate change package "contains nothing to attract investment to develop solutions to climate change, such as large-scale wind and solar energy industries in New Zealand."

Low priority

Alistair Wilson, president of the New Zealand Wind Energy Association, decries the loss of any long term energy planning. Significant interest in major wind energy development has disappeared, he says, and new investment is now low on the priority list. New Zealand is also losing its wind energy talent across the Tasman, as engineers and wind companies focus more on opportunities in Australia.

"The minister [of energy] should be quite seriously concerned about the lack of wind farm development," says Wilson. "We would like to see government leadership on the barriers to the uptake of wind such as distribution company pricing, the Resource Management Act and access to the international price for carbon."

Meantime, the energy policy vacuum has led the Northern Generation Group of TrustPower, which operates the Tararua wind farm near Palmerston North, to put on hold its stage two development which would have seen 52 Vestas V47 turbines join the 48 already on site. The company has cleared the consents process, and has until 2005 to add to Tararua -- one of the few wind farms built anywhere without subsidies or premium energy prices. But in the present political climate, TrustPower is not willing to take the risk.

"No country has developed an alternative energy industry without government support," says Kelman. He thinks the free market, hands-off mantra of the New Zealand government is naive -- and that it is missing an opportunity to provide a positive solution for climate issues, as well as assisting with local employment and regional development.

Utility commitment

Meantime, the large state-owned power utility Meridian Energy has said it aims to have 200 MW in wind power generation within the next three to five years. It has a number of proposed sites around New Zealand, but acknowledges that the country's Resource Management Act will provide a challenge in gaining consents for the development of the two or three large wind farms it has in mind.

Meridian's Shaun Cornelius says the company has been broadening its options over the last few years from its traditional reliance on hydro resources in recognition that New Zealand does have limited energy options for the future. "Wind is starting to look more attractive," Cornelius says. Lack of a wind tariff and the problematic consents process are still barriers, but he believes they are not insurmountable. "The economics of wind are now starting to look like its worth resolving some of these issues."

The optimism comes at a time when other electricity options are being increasingly squeezed. Gas shortfalls from a depletion in local gas fields have been forecast for as early as next year, and electricity shortfalls seen as likely to occur well before 2007.

Green power potential

Energy minister Pete Hodgson is aware of the country's green power potential. "New Zealand's sustainable energy future requires a balanced portfolio of energy efficiency improvements and a transition to renewable energy sources," he says. Hodgson's enthusiasm has been fired by a recent renewables report for the economics ministry by East Harbour Management Services.

The report indicates that by 2012 renewables could provide an additional 4600 GWh a year of electricity for under NZ$0.06/kWh ($0.03/kWh); at up to NZ$0.08/kWh ($0.041/kWh), about 15,000 GWh/year could be available. The government's preferred policy target for renewables is an extra 30 PJ a year by 2012 -- about 8300 GWh. Detailed resource assessments show an available annual wind resource of 9550 GWh, with 150 GWh a year already installed. As the technology matures and costs continue to drop, generation is expected to fall to NZ$ 0.04-0.06/kWh ($0.02-0.03/kWh), with the largest resource in the NZ$0.06-0.10/kWh ($0.03-0.05/kWh) range. "This report indicates that our proposed renewable energy target, while challenging, is within reach," says Hodgson.

To ensure that wind gets a piece of the action will be the hard thing. Wilson says he is hoping for dry weather, regarding Kiwis as dangerously complacent about their apparently rich hydro power resource. "A drought would be exceptionally handy," he laughs, noting that wind could beat any other response "hands down." It would be in the ground and operational well before any gas or coal fired plant.

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