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41. The scope of the New Zealand Energy Strategy is potentially very extensive, as is indicated below. It is likely to undergo further development and refinement through dialogue about key energy issues and as stakeholders provide input into the development of the draft strategy. Appendix 2 sets out the expected phases of development, including consultation, and alignment of key tasks with the replacement NEECS.

42. The scope of the New Zealand Energy Strategy would potentially cover:

1. Purpose
   1. Purpose of NZES
2. Energy and sustainable development
   1. Background - the Sustainable Energy discussion document
   2. Government energy sector objectives
3. Energy sector overview
   1. Demand and drivers for energy services
   2. Energy supply system
   3. Energy sector structure
4. Energy related challenges and risks faced by New Zealand
   1. New Zealand's energy security
      1. Prices and availability of energy types
      2. Investment in capacity to deliver energy services
      3. Imported vs domestic energy supplies
   2. New Zealand's climate change challenges
      1. Contribution to GHG emissions
      2. Long term goals and policy response
      3. Outlook for GHG emission prices
      4. Energy Sector Work Programme (ref CBC Min (05) 20/10)
         1. Opportunities to reduce energy emissions generally, including through development of the strategy, and energy research priorities
         2. The option of a narrow carbon tax (or other price based measure, such as emission trading) on electricity generators
         3. Incentives for renewable energy or disincentives for fossil fuel based electricity generation
         4. Review of the National Energy Efficiency and Conservation Strategy
   3. Local environmental impacts of energy supply
   4. Energy user and stakeholder concerns and expectations
   5. International developments - implications and risks for New Zealand
5. Current energy policy framework
   1. Role of government
   2. Role of markets
   3. Agency responsibilities
   4. Relationship with government's wider sustainable development objectives and other processes such as Climate Change, Transport Strategy
6. New Zealand's energy supply and demand resources - existing/challenges/opportunities
   1. Sources of primary energy supply
   2. Energy supply technologies
   3. Energy efficiency - technologies, practice and potentials
7. Markets and delivery of energy - existing/challenges/opportunities
   1. Electricity market
   2. Gas market
   3. Liquid fuels and biofuels
   4. Coal (including potential derivatives such as gas and liquids)
   5. Energy efficiency
   6. Renewables
8. Future energy scenarios for New Zealand
   1. Explore challenges/opportunities introduced in sections f & g for New Zealand's energy resources, markets and delivery of energy services (including emerging technologies and biofuels).
   2. Assess outcomes of different future energy scenarios across multiple objectives relating to emissions, price, and energy demand/security over time.
   3. Evaluate economic and welfare implications (e.g. impacts on balance of payments, economic output, consumers including households and major users).
9. The long-term vision - where do we want to be by 2050?
10. Identify the government's strategic priorities/goals - the intermediate steps to advance the transition of energy sector towards the long-term vision.
11. New policies and measures to deliver energy services. Outline the five-year action plan of initiatives (a summary of the opportunities identified in sections f and g that are aligned with strategic priorities).
12. Develop framework for evaluating and reviewing action plan progress.