Thermal generation ban defies logic

MEDIA RELEASE 20 June 2008

Thermal generation ban defies logic

Legislating to ban thermal electricity generation, particularly gas-fired, defies logic, the Petroleum Exploration and Production Association said.

"The Climate Change (Emissions Trading and Renewable Preference) Bill, as reported back, still includes the ban on further development of thermal power stations," PEPANZ chairman, Chris Hall, said.

"This defies logic, given we now face our third power shortage in seven years, our major industries are suffering and the rest of us face both power shortages and power prices that could jump another 15% in the short term and 40%-50% over the next 15 years as a result of government policy.

"All the while China, Russia, India and the US continue to belch CO2 into the atmosphere."

Mr Hall said the current situation more than highlights the need for a component of reliable, efficient, thermally-generated power.

"Modern, efficient, combined-cycle gas-fired power stations are exactly the type of generators that best meet New Zealand's needs, both in terms of system reliability and aggregate greenhouse gas emissions.

"They have improved the overall performance of New Zealand's electricity supply system and they are particularly helpful during relatively dry years.

"Their output is less expensive and more reliable than any new renewable generation option, and they are a much cleaner alternative to the diesel and coal-fired generation we've had to use in this latest shortage.

"Neither is there any shortage of natural gas," Mr Hall said. "There is sufficient to fuel our existing power stations for the foreseeable future, and any new ones that may be required."

Mr Hall said the select committee process was clearly too rushed.

"The NZIER prepared a 120 page, detailed report on the impacts of the Bill. The select committee gave them just six minutes to present it!

"As a result of this hurried process, the committee has not benefited from the considerable weight of argument and analysis submitted against this component of the Bill. The long-term ramifications to New Zealand are enormous."

ENDS

The Petroleum Exploration and Production Association of NZ (PEPANZ) represents companies engaged in exploration for, and discovery, development and production of, oil and gas in New Zealand. See www.pepanz.org.nz

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