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Cabinet paper: National Environmental Standards for Electricity Transmission Activities under the Resource Management Act 1991

Office of the Minister for the Environment
Cabinet Policy Committee

Proposal

1. This paper proposes national environmental standards (NES) under the Resource Management Act 1991 for electricity transmission activities. In this paper I present details of the proposed NES and a regulatory impact statement, and seek Cabinet agreement for the Ministry for the Environment to initiate the regulation drafting process.

Executive summary

2. I am seeking Cabinet approval for national environmental standards (NES) under the Resource Management Act 1991 (RMA). The proposed NES for transmission activities provides for the efficient use, maintenance and upgrading of the existing transmission network (the national grid)¹ by:
   • specifying that transmission activities that do not have significant adverse effects can be undertaken without the need to apply for resource consents (permitted activities), and
   • specifying resource consent requirements for other activities.
3. A discussion document containing details of the proposed NES was released in October 2007, and public workshops were held in Auckland, Wellington, Christchurch and Hamilton. The Ministry for the Environment (the Ministry) received 84 submissions from local and central government, industry, landowners, non-governmental organisations and individuals. The Ministry published an analysis of submissions in May 2008.
4. The proposed NES has been revised to take account of detailed comments provided by submitters. A users’ guide will address general issues submitters have raised that cannot be dealt with in the proposed NES.
5. The principal reasons for proposing the NES are that plan rules concerning electricity transmission activities are not nationally consistent. Many plans do not provide, or do not provide appropriately, for maintenance and upgrade of the transmission network.
6. In April 2008 the National Policy Statement on Electricity Transmission (NPS) came into force. The objective of the proposed NES is to support the NPS by:
   • minimising the cost to councils of implementing the NPS
   • ensuring that plan requirements are nationally consistent and achieve the intention of the NPS
   • minimising RMA processing costs and delays.
7. The Ministry evaluated five alternative options evaluated for achieving the objective: non-regulatory guidance; the preparation of voluntary New Zealand Standards; call-in of projects for consideration by a Board of Inquiry or the Environment Court; Crown submissions; and designations under the RMA for transmission lines. None of these alternatives would achieve the objective. National environmental standards would best fulfil the objective in a reasonable timeframe and at reasonable cost.
8. The Ministry has assessed the costs and benefits of the proposed NES. There is an estimated net benefit of $4.4 to $5.5 million (net present value). The benefit cost ratio was between 5.3 and 6 to one.
9. If this proposal is approved, I will instruct the Parliamentary Counsel Office to draft a national environmental standard for transmission activities.

Background

10. On 2 July 2007, the Cabinet Business Committee agreed to release a discussion document: Proposals for National Environmental Standards for Electricity Transmission for public consultation [CBC Min (07) 13/14 refers].
11. On 21 May 2008 the Cabinet Policy Committee (the Committee) noted [POL Min (08) 8/9 refers] the Ministry’s intention to revise the proposals for national environmental standards for electricity transmission to:
    • take account of the ability of the proposed national environmental standards to assist councils to implement the NPS on Electricity Transmission within the four year timeframe required; and
    • consider the comments made by submitters on the proposals, and to consult further with key submitters.
12. The Committee invited me to report back with detailed proposals for national environmental standards that:
    • set out resource consent requirements for electricity transmission operation, maintenance and upgrade (referred to as “transmission activities”)
    • establish permitted activity status for electricity transmission activities that do not have significant adverse effects (i.e. a resource consent is not required).

Need for a national environmental standard

13. There is now a pressing need, in response to a steady increase in demand for electricity and new renewable energy developments, to upgrade existing electricity transmission infrastructure. Transpower predicts a threefold increase in expenditure over the next decade. 
14. The majority of the national grid was constructed before the RMA came into force.  Existing use rights apply to the operation of the grid.  However, to maintain and upgrade the existing grid, Transpower relies on a complex system of permitted activity rules in plans, and resource consents, and in some cases designations.
15. A single transmission line operated by Transpower New Zealand Limited (Transpower) can span many districts and regions with different planning requirements. There are inconsistencies between plans. For example, placing transmission lines underground is a permitted activity in the majority of district plans but requires a resource consent to be obtained in several district plans. The requirement to apply for a resource consent in one district can delay the whole project.
16. Many plans do not provide for, or do not provide adequately for, transmission activities. This is unsatisfactory, given the national significance of the operation, maintenance, development and upgrading of the national electricity transmission network, as identified by the NPS.
17. The National Policy Statement on Electricity Transmission (NPS) came into effect in April 2008. It is a national planning document under the RMA which sets out an objective and policies establishing the national importance of electricity transmission.
18. The NPS requires that local authorities notify and process plan changes (or variations) to give effect to its objectives and policies within four years. Councils will need to review their existing plan rules and if necessary formulate new rules. Councils will then publicly notify new objectives, policies and rules, consider submissions on these, and respond to any appeals to the Environment Court on council decisions.
19. Under the status quo, it is unlikely that the new rules will be nationally consistent if produced independently by 85 local authorities. If a NES were in place, Councils would not need to incorporate the NES into plans or go through a public consultation process. They would still be required to review their plans in order to give effect to the other requirements of the NPS, not covered by the NES, in particular for new transmission lines. However, some of the costs to councils of plan review are likely to be reduced by a stand-alone set of rules which adequately reflects the operational requirements and technical constraints of maintaining and upgrading the existing transmission network while controlling the effects.

Policy objective

20. The policy objective is to support the implementation of the provisions of the NPS relating to transmission activities by:
    • minimising the cost to councils of implementing the NPS
    • ensuring that planning requirements are nationally consistent and provide adequately for maintenance and upgrading to achieve the intention of the NPS
    • minimising RMA processing costs and delays.

Evaluation of options

21. The Ministry evaluated four alternatives for achieving the objective.
    • Providing non-statutory guidance
    • Preparing New Zealand Standards
    • Using call-in and Crown submissions
    • Designations for the transmission network.
22. None of these options achieved the objective. A regulatory impact statement is attached which evaluates the options in more detail.

Proposed national environmental standards for transmission activities

23. National environmental standards are legally enforceable regulations made under sections 43 to 44 and 360 of the RMA. Standards may include numerical limits, narrative statements, or methodologies.
24. The key issues relate to existing transmission lines.  The proposed NES for transmission activities would therefore:
    • apply to the operation, maintenance and upgrade of the national electricity transmission network (“transmission activities”)
    • would not apply to construction, maintenance or upgrading  of new lines or to substations.
25. The NES will:
    • specify that transmission activities that do not have significant adverse effects are permitted, provided that terms and conditions to control environmental effects are complied with
    • specify consent requirements for activities which do not meet the permitted activity terms and conditions.

Permitted activities

26. The NES will specify that transmission activities are permitted, provided that they meet terms and conditions to ensure that there are no significant adverse effects. The types of activities to be permitted include:
    • maintenance and upgrading of conductors (wires) up to duplex (two conductors of the same phase in a double configuration) and increasing the current or voltage. These activities will be subject to conditions on conductor size and will need to meet international guidelines on electric field strengths and magnetic flux density (the ICNIRP Guidelines²)
    • maintenance and upgrading of support structures (towers and poles) and temporary line deviations subject to conditions limiting height increases (to 15% as a one-off), relocation distance, and proximity to occupied buildings
    • removal of transmission lines subject to conditions on restoring the land
    • cleaning and painting transmission support structures subject to conditions on materials used and prevention of air, land and water pollution
    • signs and telecommunications dish antennas on support structures, subject to conditions on size
    • earthworks, and trimming and removal of vegetation which is not in sensitive areas, subject to conditions on erosion control, site restoration and disposal of debris
    • construction noise, subject to compliance with standards for noise and vibration
    • minor discharges and minor activities over water and the coastal marine area, subject to conditions on receiving water quality.

Controlled activities

27. The NES specifies that certain transmission activities are “controlled” activities. This means that resource consent is required, but it cannot be declined, and the local authority can only impose conditions on matters specified in the NES. The controlled activities are:
    • maintenance and upgrading of transmission line supports including cleaning and painting
    • temporary line deviation and temporary structures
    • vegetation trimming and removal (except on public conservation land), and earthworks
    • noise, vibration and discharges to water
    • placing existing transmission lines underground.

Restricted discretionary activities

28. The following transmission activities are to be specified as “restricted discretionary” activities. This means that a resource consent is required, the consent may be declined or granted, and the local authority can only consider and impose conditions on matters specified in the NES:
    • adding conductors above duplex configuration, and adding new circuits and telecommunications facilities
    • upgrading support structures (including height increase and relocation above the permitted or controlled limits), removal of lines, permanent deviation of lines and changes to a heritage transmission tower
    • cleaning support structures
    • earthworks and vegetation removal in sensitive areas.

Discretionary and non complying activities

29. New access tracks requiring removal of vegetation in sensitive areas, or any activity which fails the permitted activity terms and conditions and is not specifically listed under any of the other activity types, will require resource consent to be applied for as a discretionary activity. This means that the council’s discretion is not limited when deciding whether to grant or decline the consent and when imposing conditions.
30. Any transmission activity that breaches the international standard for electric and magnetic fields will be non-complying This means that the consent authority may only grant resource consent if it is satisfied that the adverse effects will be minor (other than effects on persons who have given their written consent) or the activity will not be contrary to the objectives and policies of any relevant plan or proposed plan.

Ability to set more stringent or more lenient standards

31. The proposed NES for transmission activities would override specific plan rules relating to the operation, maintenance and upgrade of the existing electricity transmission network. Councils will not be able to set more lenient or stricter standards.
32. Councils may still state in their plans that transmission activities are permitted. However, the terms and conditions specified in the plan may only deal with effects not covered in the NES (otherwise the provisions of the NES prevail).

National environmental standards to protect transmission lines from the effects of third party activities

33. As agreed by Cabinet in May 2008 [POL Min (08) 8/9 refers], the Ministry is re-examining whether to proceed with the proposal in the October 2007 discussion document for regulations to protect transmission lines from inappropriate third party activities (risks NES). This proposed standard would have established buffer zones around transmission lines in order to reduce risk to the lines.

Consultation process

34. Section 44 of the Resource Management Act required me to notify the public and iwi authorities of the proposed subject matter of the standard, and why I consider the standard is consistent with the purpose of the RMA. It also required me to establish a process which gives the public and iwi authorities adequate time and opportunity to comment on the proposed subject matter of the standards.
35. The discussion document Proposed National Environmental Standards for Electricity Transmission was notified and released for public comment on 13 October 2007. Public notices were placed in major newspapers on the same day. Consultation ran until 30 November 2007.
36. Public workshops were held between 15 and 24 October 2007 in Auckland, Hamilton, Christchurch and Wellington, to present details of the proposed standards and provide the opportunity for interested parties to discuss the proposals with Ministry staff. Officials also met individually with other government departments and agencies, and the electricity industry.
37. Eighty four submissions were received on the proposals. Forty six percent of submissions were in favour of the proposals, with or without qualification.  Forty three percent opposed the proposals (although much of the opposition was based on concerns about Transpower’s access to private land) and the remainder did not state a position.
38. In May 2008, a report on submissions was published on the Ministry’s website and a copy was sent to every submitter.
39. The Ministry revised the proposed NES to take account of submitter comments with the assistance of local government and Transpower representatives and the Ministry of Health. The Ministry of Agriculture and Forestry, Ministry of Health, Department of Conservation and Te Puni Kōkiri also provided feedback on the proposed NES. Appendix 1 sets out the key concerns raised by submitters and the Ministry response.

Evaluation of costs and benefits

40. The Ministry carried out an economic analysis of the potential impacts of the proposed standard. Results are summarised in the attached regulatory impact statement.
41. At a 10% discount rate, the net present value of the proposals is $4.4 million, with a benefit cost ratio of 5.3 to one. Using a 5% discount rate the net present value is $5.5 million and the benefit cost ratio is 6 to one.
42. Section 32 of the Resource Management Act (RMA) requires that before a regulation is made, I  carry out a broader appraisal of:
    • the extent to which each objective is the most appropriate way to achieve the purpose of the RMA
    • whether, having regard to their efficiency and effectiveness, the policies, rules, or other methods are the most appropriate for achieving the objectives
    • the benefits and costs of the proposal, and the risk of acting or not acting if information is uncertain or insufficient.
43. I will publish a Section 32 report once the regulations have been made.

Tools to assist local government

44. A number of the issues raised by submitters cannot be directly addressed by the NES, but will be addressed through non-statutory guidance material. The Ministry proposes to produce a users’ guide to the NES and conduct workshops (in conjunction with workshops on the NPS), to assist councils to implement the NES.

Departmental Consultation

45. The following agencies have been consulted on this paper and their views taken into account: Department of Building and Housing, New Zealand Defence Force, Department of Internal Affairs, Department of Conservation, Land Information New Zealand, Ministry of Agriculture and Forestry, Ministry of Economic Development, Ministry of Health, Te Puni Kōkiri, Ministry of Transport, Treasury. The Department of the Prime Minister and Cabinet has also been advised about this paper.

Financial implications

46. There are no financial implications arising from this paper.

Human rights

47. There are no inconsistencies with the rights and freedoms contained in the New Zealand Bill of Rights Act 1990 and the Human Rights Act 1993.

Legislative implications

48. The proposed NES will be made as a regulation under sections 43 and 360 of the Resource Management Act 1991 and will be made by the Governor-General, by Order in Council.

Regulatory Impact Analysis

49. MFE confirms that the principles of the Code of Good Regulatory Practice and the regulatory impact analysis (RIA) requirements, including the consultation RIA requirements, have been complied with. A RIS was prepared and the Regulatory Impact Analysis Unit considers the analysis and the RIS to be adequate according to the adequacy criteria set out in CO (07) 3.  The final RIS was circulated with the Cabinet paper for departmental consultation.

Gender implications and disability perspective

50. There are no gender implications or implications for people with disabilities arising from this paper.

Publicity

51. I expect the final regulations to be approved in early 2009. I will release press statements at the time the regulations are made.
52. If the paper is approved, I propose that the Cabinet decision and any Annexes (including the Regulatory Impact Statement) be publicly released and posted on the Ministry for the Environment website.

Recommendations

53. The Minister for the Environment recommends that the Committee:
    1. note that the Committee invited the Minister for the Environment to report back with detailed proposals for regulations, setting out consent requirements for electricity transmission activities, and establishing permitted activity status for electricity transmission activities that do not have significant adverse effects. [POL Min (08) 8/9 refers].
    2. note that the proposed national environmental standards for electricity transmission activities will support the implementation of relevant provisions of the National Policy Statement on Electricity Transmission by:
       1. minimising the cost of implementing the National Policy Statement;
       2. ensuring that planning requirements are nationally consistent and provide adequately for the operation, maintenance and upgrading of the electricity transmission network (transmission activities) to achieve the intention of the National Policy Statement; and
       3. minimising RMA processing costs and delays.
    3. note that analysis has demonstrated that a national environmental standard is the most effective and efficient method of achieving the objectives listed in paragraph 2.
    4. agree that national environmental standards be developed for electricity transmission activities to:
       1. apply to the operation, maintenance and upgrade of the existing electricity transmission network (transmission activities) but not to substations or the construction of new lines;
       2. specify that transmission activities are permitted, provided that terms and conditions to ensure that these activities do not have significant adverse effects are complied with; and
       3. specify resource consent requirements for transmission activities which do not meet the terms and conditions for permitted activities.
    5. invite the Minister for the Environment to issue drafting instructions to the Parliamentary Counsel Office to develop national environmental standards under the RMA for transmission activities referred to in paragraph 4.
    6. agree that the Ministry for the Environment may publicly release this Cabinet paper, including Cabinet decisions and the Regulatory Impact Statement, once Cabinet has made a decision
     

Hon Trevor Mallard
Minister for the Environment

 Appendix 1: Key issues raised by submitters

Last updated: 23 September 2008