A good submission on the oil and gas ban bill
Been sent a copy of the submission by Barry Brill. He’s a former Under-Secretary of Energy and a former president of both the New Zealand Manufacturers Federation and the Electricity Supply Association. So he knows a bit about this area.
Some extracts:
- The apparent purpose of the Bill is to expel the future mining of oil and gas from the New Zealand region. That outcome would contribute nothing to the international goal of reducing global CO2 emissions.
- Everybody interested in climate change policy is familiar with the problem of “carbon leakage”. Every tonne of product that is displaced from New Zealand is certain to mean an additional tonne being produced elsewhere in the world. That substitute source may well have much looser standards against flaring, fugitive gas, spills, etc than New Zealand. The relocation cannot produce any environmental upside but can readily produce downsides.
- Unless and until the industrialised world abandons hydrocarbon fuels, New Zealand will continue to use gas for much of its industrial heat as well as for firming the electricity system. If that gas cannot be produced here and piped through the existing network, it will have to be shipped in the form of LNG. The inherent inefficiency of that transport system will add significantly to the world’s CO2 emissions. Existing assets will be stranded while new resources are unnecessarily redirected.
- Only yesterday, the CEO and Chair of Genesis Energy explained that this Bill would defeat their company’s earlier commitment to remove coal by 2030. In continuing its mission of preventing blackouts in dry years, the Huntly station will have to burn coal or import LNG – if this Bill is passed.
- The policy was apparently agreed at a confidential meeting of three MPs, and then announced. The three authors were unaware that their covert plan was (a) illegal and unenforceable and (b) financially and environmentally disastrous – because all the normal protections for bureaucratic advice were by- passed. No formal consultation was undertaken with the industry or anybody else. The plan was not considered by the cabinet or any other constitutional organ of government. This was the worst example of autocratic and unaccountable governing since the days of “King Dick” Seddon.
- The Minister has further relayed the misinformation that “the world is moving away from fossil fuels”. Thousands of highly-qualified analysts and policy advisers make a living from studying and projecting the demand curves for oil and gas. Their consensus view is reflected in the official projections of the International Energy Agency (IEA) in Paris, which has just reiterated its previous official advice that demand is expected to RISE by 2040.
- The Minister also relies upon her impression that MBIE “does not take into account the fast pace at which China and India are cutting emissions”. This foundational belief contrasts strongly with what last week’s Financial Times reported: China’s carbon emissions are on track to rise at their fastest pace in more than seven years during 2018, casting further doubt on the ability of the Paris climate change agreement to curb dangerous greenhouse gas increases, according to a Greenpeace analysis based on Beijing’s own data.
So who do we believe – Megan Woods or the thousands of professional analysts and advisors?