Renewable electricity up, but so are emissions

Friday, 29 March 2019, 1:09 pm
Article: NZ Energy and Environment Business Week

Renewable electricity up, but so are emissions

First published in Energy and Environment on March 21, 2019

The latest energy statistics show a rise in greenhouse gas emissions across the sector dominated by increasing petrol and diesel use for transport and coal for generation.

Despite an increase in coal-fired generation to replace reduced gas supply, renewable sources still made up 84.5% of electricity generation in the final quarter of 2018. However, this still meant emissions from electricity generation increased.

The Ministry of Business, Innovation and Employment’s latest Energy Quarterly data shows a picture of higher costs across petrol, gas and wholesale electricity. Despite this there was no real reduction in consumption.

Electricity generation emissions increased from 992.96 kilotonnes carbon dioxide equivalent in the Sept quarter to 1,217.70 kt CO2-e in the December quarter and compared to 1,155.66 kt CO2-e in the December 2017 quarter. This was due to the fall in gas emissions from 690.05 kt CO2-e in the September quarter to 507.35 kt CO2-e in the December quarter. This was replaced by the offset from coal causing a larger lift in emissions from 107.71 kt CO2-e in the September quarter to 514.57 in the December quarter.

The data shows how much more significant the transport sector is in terms of emissions.

Emissions from liquid fuel combustion, such as petrol and diesel, increased from 4,670.18 kt CO2-e in the September quarter to 5,133.00 kt CO2-e in the December quarter and from 5,045.51 kt CO2-e in the December 2017 quarter.

As the use of petrol increased so did electricity demand with a rise of 1.1% when compared to the December 2017 quarter. This was largely due to a strong dairy season, irrigation demand and NZ Aluminium Smelters re-energising their fourth potline.

For the October-December 2018 quarter renewable sources accounted for 84.5% of electricity generation, up from 81.9 percent on the same quarter a year ago and in line with the renewable figure for the previous quarter.

This was despite lower wind generation and higher coal use as gas-fired generation declined 38% on the December 2017 quarter.

Reduced output from the Pohokura gas field while repair work was undertaken led to a decline in overall gas supply of 21% from the same quarter a year earlier. Several shut downs occurred to correct faults in the pipeline system and these resulted in significant interruptions to gas supply. This tightening of gas supply was felt by major gas consumers despite their scheduling of maintenance to coincide with shortages. Methanex’s output in the December 2018 quarter was 30% lower than a year ago

In comparison coal-fired generation increased by 84% on the comparable 2017 quarter.

The jump in coal-fired generation pushed it to the highest quarterly volume since March 2015, but it still only contributed 6.3% of the generation mix as both hydro and geothermal generation rose. This was aided by above-average hydro storage for much of the year offsetting the drop in gas fired generation to the lowest level in more than 20 years.

Wind generation for this time of year was at its lowest since 2011, despite the increase in generation capability over this time.

In the wider energy sector, there was the noticeable higher petrol and diesel prices compared to the same time last year. The national average price for petrol hit $2.17 per litre, up 11% on the December quarter in 2017 while diesel rose by 24%. Petrol prices reached their highest level on record in the quarter, with a weekly high of $2.43 per litre in the week ended Friday 12th October. Prices then fell sharply for the rest of the quarter, ending 2018 at similar levels to the beginning of the year.

The Government is still saying it wants to set a target of 100% renewable electricity generation by 2035 in a year of normal hydrology, though Climate Change Minister James Shaw said they would be guided by the Climate Change Commission.

The Interim Climate Change Committee has said the electricity system is on track to be 93% renewable by 2035 and its initial view is squeezing out the last few percentage points would be prohibitively expensive, while the gains in emissions reductions would be relatively small.

Energy and Environment

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