Skip to main content.

Frequently asked questions on the discussion papers

What is the purpose of the draft energy strategy?

The draft New Zealand Energy Strategy to 2050 considered New Zealand's future energy system, and identified opportunities for securing that future.  This draft was the basis for stakeholder and public engagement between December 2006 and March 2007 on the short and long-term policy decisions about New Zealand's energy future.

The final New Zealand Energy Strategy was released in September 2007. For more informaton see the frequently asked questions on the New Zealand Energy Strategy.

What was the purpose of the Transitional Measures discussion paper?

It formed part of the draft New Zealand Energy Strategy.  In this document, the government sought feedback on what we should be doing in New Zealand's stationary energy sector in the near-term to move us towards the long-term goal of having a low emissions energy sector.  It presented a number of options including, emissions trading, a carbon charge, renewable obligations, incentives, project based measures, regulatory options and voluntary measures.

What was the purpose of the Post-2012 discussion document?

It was designed to draw out discussion on what policy measures would be preferred in New Zealand after 2012 to reduce its emissions and to protect and enhance its forest carbon sinks.  The paper provided a longer-term context for selecting sectoral policies that will place New Zealand on a desirable pathway for managing its emissions and sinks in a manner consistent with its national interests.

What options were considered in the Post-2012 discussion document?

A number of options were laid out for discussion because a mix of policy measures - including price-based, regulatory and voluntary measures - are needed to achieve the integration of New Zealand's climate change and other sustainable development objectives.   The document specifically assessed two price-based measures (emissions trading and greenhouse gas charges), directive regulations (such as under the Resource Management Act or Electricity Act), and emission reduction agreements.  With regard to emissions trading, the paper assessed cap and trade, baseline and credit, and offsets trading models. 

During consultation on the Post-2012 discussion document, emissions trading emerged as the most preferred option.

In September 2007, government announced an in-principle decision to implement a cap-and-trade emissions trading scheme in New Zealand, covering all sectors and all gases by 2013.

What are the highlights?

Details on the following initiatives can be found in the Strategy's action plan as indicated:

  • Establishment of an expert group to consider implications of higher levels of biofuels and the introduction of plug-in electric vehicles (see section 2, p 34)
  • Measures to improve the efficiency of the vehicle fleet, through mandatory labelling of fuel efficiency at the point of sale and introducing technology standards  (see section 2, p 35)
  • Support for the introduction of renewable fuels as substitutes for petrol and diesel (see section 2, pp33-37)
  • Increase competition in the electricity market by reducing restrictions on generation and retailing by lines companies (see section 4, p44)
  • Options for internalising the cost of fossil fuel emissions in the electricity sector to those who produce them (see section 4, p48)
  • A proposed requirement for major electricity generators to prepare triple bottom line reporting, including greenhouse gas emission inventories (see section 4, p51)
  • Regulations to facilitate distributed generation (see section 4, p53)
  • Consideration of a mechanism to consider RMA consent applications for wind and geothermal electricity generation projects in groups, to better compare national benefits and environmental impacts (see section 4, p55)
  • Lowering the discount rate used by the government in working out the cost-benefit analysis for energy efficiency projects, to reflect the value of long-term energy savings (see section 5, p61)
  • Establishing a contestable fund to support the early deployment of marine-based electricity generation such as wave or tidal, worth $8 million over four years (see section 6, p71).

Why develop a New Zealand energy strategy?

We need to ensure New Zealand has a secure and affordable energy supply in the future.  When finalised, the New Zealand Energy Strategy will lead our long-term direction, so that the energy sector and consumers can respond to the energy challenges and opportunities of the future.  By setting clear policy direction and priorities for the energy sector, the government can provide more regulatory stability and confidence to industry players, investors and consumers, and facilitate the transition to a more sustainable energy future.

Why to 2050?

The inherently long lead times for making significant changes in the production and use of energy mean that decisions made, or avoided, in the next few years, will have effects for decades.

What does the government see for New Zealand's energy future?

The government wants to work towards a "reliable and resilient system delivering New Zealand sustainable, low emissions energy".  Reliability means consumers can access the energy services they require, when they require them, and resilience is the ability of the system to cope with shocks and changes in supply.  The government's vision is set out in detail in the first part of the draft energy strategy.

How does the government intend to achieve this?

The government will focus on policies, strategies and initiatives that support the following six high-level objectives:

a. Providing clear direction on the future of New Zealand's energy system

b. Maintaining high levels of security of energy supply, and reliability at competitive prices 

c. Maximising how efficiently we use our energy to safeguard affordability, economic productivity and our environment

d. Maximising the proportion of energy that comes from our abundant renewable energy resources

e. Reducing our greenhouse gas emissions

f. Promoting environmentally sustainable technologies

What is the government proposing to do?

Part two of the draft energy strategy outlines a draft action plan across six broad areas:

a.  Creating a resilient, low carbon transport system

b. Maintaining security of electricity supply

c. Transitioning to low emissions power and heat

d. Using energy more efficiently

e. Encouraging sustainable technologies and innovation

f.  Promoting affordability and well-being.

Each section contains a series of proposals set out for discussion and consultation, alongside information on work already underway by the government.

How can we achieve a resilient, low carbon transport system?

The draft strategy proposes four priority areas for action, with a focus on reducing greenhouse gases.  They include developing and adopting alternative renewable fuels such as biofuels or by introducing electric cars, improving the fuel efficiency of vehicles on New Zealand's roads, using more efficient modes of transport, and ensuring a secure and diverse supply of transport fuels.

How is the government proposing to manage security of electricity supply?

The government's proposed actions build on several initiatives to encourage competition and investment in transmission and distribution networks, and a move to more diverse gas supplies.  They include enhancing existing regulatory measures, reducing legislative barriers to generation and related retailing for lines companies, developing policies to manage the increasing contribution of wind and other intermittent renewable energy sources, and continuing to bed in the gas market regime.

How would New Zealand transition to a low emissions power and heat system?

Actions proposed by the government to limit greenhouse gas emissions from electricity generation and industrial heat and power include, price incentives for investors in new low emissions energy sources, establishing a working group of electricity generators to develop triple bottom line reporting and an inventory of greenhouse gas emissions, encouraging more people to use solar water heating, consideration of resource consent processes for wind and geothermal electricity generation project, and breaking down barriers that are preventing the uptake of low emissions technologies, such as distributed generation.

How could energy efficiency be improved?

The government's policies, objectives, targets and means for energy efficiency, energy conservation and use of renewable energy are set out in the replacement New Zealand Energy Efficiency and Conservation Strategy, which is a subset of the draft energy strategy and is being consulted on at the same time as the draft energy strategy.  Actions are being developed around the following objectives - better products that save energy and money; healthy homes that use less energy, smarter commercial buildings encouraging more productive work environments, increased energy productivity in industry, sustainable agriculture with efficient low carbon emissions, and efficient transport and freight movement.

What will be done to promote sustainable technologies and innovation?

Proposed actions include establishing working groups to provide leadership in priority energy innovation areas such as geothermal, marine energy, biofuels and carbon capture and storage.  The government also proposes strengthening capabilities, collaboration and networks around key sustainable energy themes, and considering options supporting energy innovation in New Zealand such as tax credits for R&D and an accelerator fund to assist getting promising technologies to market. The government will establish a contestable fund to assist deployment of marine-based electricity generation.

How will affordability and well-being benefits be promoted?

The government is inviting feedback on this area through the consultation on the New Zealand Energy Efficiency and Conservation Strategy.  The government is also considering varying the lower fixed charge tariff option, to take account of regional climate variations that impact on heating costs, and taking a stronger role in supporting the development of sustainable and improved urban form and transport infrastructure. 

What is the future for coal in this strategy?

Coal and lignite represent important long-term energy supplies.  If carbon capture and storage proves technically viable and economic in the future, these fuel sources will become an attractive resource for a range of uses in the future.

What is the potential for reducing greenhouse gas emissions in the energy sector - is carbon neutrality feasible?

This strategy shows how New Zealand can advance towards carbon neutrality.  There are several pathways available to achieve significant reductions in greenhouse gas emissions over the long term, but all will require focus on energy efficiency, and advances in new vehicle and electricity generation technologies and their uptake.

What is the purpose of the Transitional Measures discussion paper?

It forms part of the draft New Zealand Energy Strategy.  The government is seeking feedback on what we should be doing in New Zealand's stationary energy sector in the near-term to move us towards the long-term goal of having a low emissions energy sector.  It presents a number of options including, emissions trading, a carbon charge, renewable obligations, incentives, project based measures, regulatory options and voluntary measures.

What is the purpose of the Post-2012 discussion document?

It is designed to draw out discussion on what policy measures would be preferred in New Zealand after 2012 to reduce its emissions and to protect and enhance its forest carbon sinks.  It is crucial to consider future policies now.  The paper provides a longer-term context for selecting sectoral policies that will place New Zealand on a desirable pathway for managing its emissions and sinks in a manner consistent with its national interests.

What options are being considered in the Post-2012 discussion document?

A number of options look to increase the coverage of climate change policies across the economy post-2012.  The government has already signalled that a mix of policy measures - including price-based, regulatory and voluntary measures - are likely to be needed to achieve the integration of New Zealand's climate change and other sustainable development objectives.   The document specifically assesses two price-based measures (emissions trading and greenhouse gas charges), directive regulations (such as under the Resource Management Act or Electricity Act), and emission reduction agreements.  With regard to emissions trading, the paper assesses cap and trade, baseline and credit, and offsets trading models.  No decisions have been taken on these measures by government.  The paper lays out options for discussion. 

Last updated: 20 March 2008