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Energy

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  • Total primary supply
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Total primary energy supply

This indicator measures the total amount of primary energy available for energy production in New Zealand. It includes coal; domestic oil and gas extracted from wells; imported oil and oil products; and hydro, geothermal and other renewable energy sources used for electricity generation and heat production.

The supply of primary energy for energy production is shaped by a complex interaction of variables, including:

• demand for specific energy types (eg, oil for transport)
• relative cost of making specific forms of energy available (eg, cost of gas extraction versus the cost of wind generation)
• geopolitical accessibility to specific energy types (eg, political and social unrest in oil exporting countries).

All forms of primary energy supply have impacts on our environment through their extraction, distribution and conversion, for example:

• greenhouse gas emissions associated with the extraction of fossil fuel
• risks of environmental contamination from the extraction and transportation of fossil fuels
• ecological impacts arising from geothermal, hydro and wind energy developments.

As there is a range of environmental impacts associated with extracting, distributing and converting each type of primary energy, it is important that we understand which types are made available in New Zealand (and in what proportions) as it helps us understand how to minimise the specific environmental impacts they may cause.

Current situation

In 2007, New Zealand’s total primary energy supply was 752 petajoules, or approximately 178 gigajoules per person. This equates to about 5000 litres of petrol per person. About two-thirds of this (508 petajoules) was used as consumer energy. The remaining third was used or lost during energy transformation and distribution to consumers (eg, converting geothermal steam into electricity and conducting it to consumers) or diverted into non-energy products (eg, the production of urea fertiliser and methanol from natural gas).

More than two-thirds (70 per cent) of the primary energy available for energy production in New Zealand was derived from non-renewable resources, such as oil (38 per cent), gas (23 per cent), and coal (9 per cent). The remaining supply was derived from renewable resources, such as hydro-electricity (11 per cent), geothermal (12 per cent), and other renewables (eg, biogas, wind, wood and solar water heating) (7 per cent).

Read table of data of this graph

Long-term trend

Total primary energy supply in New Zealand increased by 4 per cent between 1998 and 2007. While the long-term trend is upwards, as shown in the figure below, it is a trend marked by volatility. The most recent example of volatility was the 6 per cent fall in energy production between 2001 and 2003.

A fall in the recorded amount of geothermal energy supply was one contributing factor. This, however, was largely the result of a change in the way geothermal energy supply is measured. In fact, geothermal energy is expected to increase in the long run, with a number of large-scale projects coming on line in the near future. Geothermal energy supply impacts on the environment, through harmful discharges into waterways and land subsidence, and through the release of fugitive greenhouse gas emissions, albeit on a small scale – in 2007 these emissions accounted for only 1 per cent of New Zealand’s energy-related greenhouse gas emissions.

A second contributing factor to this fall was a 27 per cent reduction in the availability of natural gas for energy production over the same period. This was the result of a reduction in the estimated economically recoverable reserves in New Zealand’s largest natural gas field. While this fall in the availability of natural gas has led to a fall in environmental impacts associated with its use, such as greenhouse gas emissions, the net environmental impacts have been mitigated by two main factors:

• First, although the availability of natural gas for energy production was reduced, the 47 per cent increase in the availability of coal led to an increase in the percentage of total primary energy supply derived from fossil fuels between 2001 and 2003.
• Second, the increased scarcity of natural gas led to a reduction in methanol production. As a result, carbon previously sequestered during the methanol manufacturing process is now being released as fugitive emissions through the venting process in natural gas manufacturing. Therefore, while the supply of natural gas fell by 12 per cent between 1998 and 2007, greenhouse gas emissions related to its supply have actually increased.

Ultimately, energy-related greenhouse gas emissions increased by 20 per cent between 1998 and 2007.

Primary energy supply in New Zealand, 1974–2007

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Recent trend

Between 2005 and 2007, total primary energy supply increased by 1 per cent. This small increase is consistent with the trend for the previous two years. There were, however, significant changes in the supply of specific primary energy types over this period. Coal supply fell, while gas and renewable sources increased.

Coal supply fell by 29 per cent between 2005 and 2007. This fall in supply is partly attributable to reduced availability resulting from a 14-month $25 million redevelopment of the Spring Creek mine, as well as delays in accessing resources in the Stockton mine. The fall can also be attributed to a large decrease in the use of coal for electricity generation, as a result of the commissioning of the new gas-fired electricity generation station at the Huntly site in 2007. This fall in supply contributed to a 34 per cent decrease in greenhouse gas emissions related to the extraction, distribution and conversion of coal.

Gas supply increased by 14 per cent between 2005 and 2007. The increase was because the Pohokura natural gas field came on line, accounting for 36 per cent of the gas supplied in 2007, as well as a 26 per cent increase in the use of gas for electricity generation between 2005 and 2007. Gas-related greenhouse gas emissions increased 16 per cent between 2005 and 2007.

There was also an increase in renewable sources of primary energy between 2005 and 2007, with geothermal supply increasing by 5 per cent, and other renewables increasing by 6 per cent.

In total, non-renewable energy supply decreased by 0.2 per cent, while the supply of renewable sources of energy increased by 4 per cent between 2005 and 2007.

International comparison

According to the latest Organisation for Economic Co-operation and Development (OECD) comparison, New Zealand has the fifth lowest level of primary energy supply in the OECD. Given that the environmental impacts of primary energy supply depend largely on the specific types of energy being supplied, this measurement provides only a rough estimate of their national environmental impacts.

Because non-renewable primary energy sources have higher environmental impacts, ranking nations according to the proportion of their total primary energy supply being met from renewable sources provides a better perspective of the environmental impacts associated with primary energy supply. Under this measurement, New Zealand ranks very well, trailing only Norway and Iceland among the OECD countries. As seen in the figure below, this is well above both the OECD and world averages.

International comparison of the proportion of total primary energy met from renewable sources, 1971–2007

Read table of data of this graph

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Last updated: 24 July 2009