Executive Summary
2. Energy policy is being given heightened consideration worldwide due to dramatic price increases, potential future constraints on fuel supplies and widespread acknowledgement of the threat that climate change poses. Energy has an essential role in modern societies for underpinning welfare and economic performance. As a consequence energy is one of the most important issues facing the world. New Zealand is no exception.
3. The government announced it would develop a New Zealand Energy Strategy to provide long-term direction and leadership to put New Zealand firmly on the path to an energy system that supports economic development, while being environmentally responsible. The government also emphasised renewed commitment to promoting energy efficiency and renewable sources of energy.
4. This work follows the document, Sustainable Energy, which framed the key challenges for New Zealand's energy future and formed the basis for discussion with stakeholders. It also established the government's key objectives for a reliable, environmentally responsible and fair and efficiently priced energy sector, including energy use.
5. The principal challenge is to strike an appropriate balance between flexibility around the various options and the direction needed to provide a reasonable level of certainty that objectives will be met. To do this the strategy will focus on some key questions to identify the strategic directions and priorities in the face of uncertain future events and developments. The strategy will consider issues across a range of future energy scenarios to establish long-term policy goals and guiding principles for decisions about the various energy options. For example:
- To what extent can New Zealand reduce its dependency on oil (or fossil fuels) by 2030?
- Whether non-transport energy should be 100% renewable or carbon neutral over the long term?
- What is the scope to reduce primary energy demand by 2030 while meeting the needs of a growing economy?
- To what extent can renewable (stationary and transport) energy meet primary energy demands by 2030?
- What role should coal play in the transition to more sustainable energy sources?
- What are the pros and cons of different options to fill an indigenous gas supply gap and what if any are the dynamic implications of such choices for New Zealand's domestic oil and gas exploration over time?
6. Due to the inter-linkages with the development of climate change policy and the replacement NEECS the development of a New Zealand Energy Strategy is a whole of government process led by the Ministry of Economic Development. The key development phases of the NZES and NEECS will be coordinated to the extent practicable. A system-wide perspective is needed to take account of the cross-links between energy policy objectives and those of other policy processes, including climate change, and also to clearly identify how the New Zealand Energy Strategy fits in relation to other strategic frameworks.
7. This paper emphasises that an inclusive, robust and transparent engagement process with stakeholders throughout the development of the strategy is critical to achieving an enduring long-term vision which has the desired level of acceptance among the public. It is desirable that this paper is publicly released.
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