Govt tells consumers: Stop Saving Energy!

Green Party Co-Leader Jeanette Fitzsimons has cautiously welcomed the introduction of a Crown Electricity Commission and measures to ensure security of supply, but warned they would only solve half the problem.

Ms Fitzsimons said half of Energy Minister Pete Hodgson's announcement was missing: Although the measures Mr Hodgson announced would strengthen supply needs, they would do little to reduce demand.

Mr Hodgson announced that an Electricity Commission would be established in three months and would contract with generators to provide reserve power supply, ringfenced to be used only in emergency. But there would be no opportunity for offers to reduce demand to be part of the market for dry year security.

"I am particularly concerned at the Minister's statement that new Zealanders will never have to save power again. This encourages the culture of waste that is partly responsible for the mess we find ourselves in.

"New Zealand uses far too much power inefficiently. It is hard to see how a solution could be sustained that does not recognise the need to reduce power demand," said Ms Fitzsimons.

"Mr Hodgson has announced what he calls 'an insurance policy' at the cost of half a cent per unit. This would do nothing to encourage New Zealand to use power more efficiently if they're already paying for back-up generation.

"While the Minister has provided a mechanism for the provision of reserve supply, there is little incentive for consumers and suppliers to reduce power demand except the risk of future shortages and price rises. Now the Minister has removed this as well.

"It is a very expensive option when you consider the cost of building a power station, keeping it on stand-by and then dusting it off maybe one year in ten. It will raise our power bills all the time.

"Standby generation will be fossil-fuelled, it will be expensive and it will be dirty. It is likely to be old plant that is very inefficient with bad environmental effects so we need to ensure we minimise the need for it - allowing demand reduction to compete with new supply could do that."

Ms Fitzsimons said the Crown-controlled Electricity Commission was well overdue.

"We welcome the end of a very expensive two year experiment that was bound to fail. New Zealand was the only country in the world that has been trying to run an electricity market without regulation.

"Government policy initiated in 2000 called for security of supply, minimising Greenhouse gases, minimising resource waste and encouraged new renewable forms of energy. So far we've had no one responsible for delivering this."

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