Energy Minister Woods says low income people shouldn't subsidise solar power
By Pattrick Smellie
March 13 (BusinessDesk) - Energy Minister Megan Woods has told a major electricity industry conference the government is
watching to make sure low-income consumers don't end up facing higher electricity costs caused by wealthier people
installing solar power units.
Commenting for the first time in detail to an industry audience on the electricity sector review promised in last year's
coalition government agreement, Woods said the review would focus on whether the current regulatory framework remained
appropriate "as we look to the future".
"This is particularly in the context of the rise of emerging technologies like solar panels and distributed generation
which mean that more people who can afford to are able to draw less electricity from the grid, pushing the price of
electricity up for everyone else - often the people who are least able to afford it.
"I want the review to consider whether current regulations in place allow consumers, especially those in lower
socio-economic areas, to fully realise the potential benefits of emerging technology."
Her comments place her at odds with the Green Party, which supports the government on supply and confidence votes in
Parliament. Its energy spokesman, Gareth Hughes, is a long-time advocate of subsidised solar rooftop installations as a
way to increase renewable electricity generation in New Zealand. Renewable electricity from hydro, wind and geothermal
sources currently produce around 85 percent of the country's electricity.
The government is committing to New Zealand achieving 100 percent renewable electricity by 2035, based on a year with
average inflows to the country's hydro-electricity storage lakes.
Woods also signalled a focus on the Low User Fixed Charges Regulations, which were introduced by the previous Labour-led
government and were intended to reduce electricity charges for households consuming little electricity. However, they
had no benefit for large, low-income households and have allowed high income, low-user households to access cheaper
power.
"Participants in the electricity sector have been highlighting their ongoing concerns on the regulations and the review
is an opportunity to assess their role in the wider context of supporting New Zealanders to afford their energy bills,"
she said.
She also acknowledged newly published research by several electricity network owners warning that rapid uptake of
electric vehicles could place severe peak-load pressure on the electricity system and require costly upgrades unless
carefully planned for.
"One of the critical roles of the Climate Commission will be to chart a transition path that ensures we have security of
supply without pushing prices sky-high as a result of the required levels of over-capacity that a 100 percent renewable
energy system will require," she said, referring to the government's plan to create an independent commission to advise
on national carbon budgets required for New Zealand to meet its 2030 greenhouse gas emission reduction targets.
Woods also cited the potential for hydrogen produced from renewable electricity to be used as both a transport fuel and
to produce electricity instead of using natural gas.
"The global market for hydrogen technologies is growing and costs of production are coming down. Our government wants to
ensure that the domestic market grows," Woods said.
Also on the agenda is an industrial process heat conversion investigation, which the Ministry of Business, Innovation,
and Employment is developing with the Energy Efficiency and Conservation Authority.
Woods said innovation in any of these areas could be assisted by the government's intention to introduce a new form of
research and development tax credit, with public consultation due to start next month on their design.
(BusinessDesk)