The New Zealand

Climate Science Coalition

Hon Secretary, Terry Dunleavy MBE, 14A Bayview Road, Hauraki, North Shore City 0622

Phone (09) 486 3859 - Mobile 0274 836688 - Email - terry.dunleavy@nzclimatescience.org.nz

5 December 2007 FOR IMMEDIATE RELEASE

Moratorium on thermal power stations will lead to rotating blackouts

The moratorium on the building of thermal power stations announced by the Government this week will lead to rotating blackouts. This is the view of Auckland energy consultant, Bryan Leyland, who is also chair of the economic panel of the New Zealand Climate Science Coalition.

Mr Leyland has been involved in the electricity and energy business in New Zealand for the last 50 years. From 1992 to 2003, he produced the only independent review of electricity generation and demand in New Zealand.

"In all that time, I have never seen anything that is potentially so disastrous for electricity supply and for the economy as the New Zealand Energy Strategy and the Emissions Trading Scheme," said Mr Leyland. "The central focus is climate change and political expediency not strategy and energy. It also demonstrates that electricity supply is now more firmly under government control than it was in the 'bad old days' when the Power Planning Committee issued reports that anyone could understand and that clearly set out the options as well as the arguments for and against them.

"The moratorium on thermal power stations running on 'base load' has been done, it seems, to stop generators building more base load gas turbine stations if, as is likely, we find more gas. Instead of 'the market will provide' we now have 'the market shall not be allowed to provide'. So much for an electricity market and an industry free from political interference. The reforms are gone and the electricity industry is being driven by people who don't understand the problems of providing New Zealand with an economic and reliable supply of electricity. Their driver is a blind belief - against the evidence - that carbon dioxide causes dangerous global warming and if New Zealand switches to renewable energy it will save the world.

"According to the government's own Electricity Commission, wind power is very expensive - more than 11 cents per kWh - and it will need another 2c/kWh or more to provide the transmission and backup or when the wind isn't blowing. Coal, nuclear, and large hydro power would provide electricity for about 8c/kWh and would not require near as much transmission or as much backup. So there is one thing we can be sure of: compared with the alternatives, the energy strategy will give us a very expensive supply of electricity.

"If the strategy is implemented, it is inevitable that, sooner or later there will be a need for rotating blackouts when the demand is high and the wind is not blowing. The public reaction to this will be so strong that, whichever government is in power, it will have to take desperate measures. The only option it will have is to purchase open cycle gas turbines that are inefficient and extremely expensive to run. So the cost of electricity will increase even more and these inefficient gas turbines will spew lots of carbon dioxide.

"If, instead, we built a nuclear power station north of Auckland, we would save billions of dollars on power transmission and we would have a secure and reliable supply at a predictable price. And for those who believe in global warming, there would be a massive reduction in emissions of carbon dioxide (CO2). Many countries that believe that CO2 causes dangerous man-made global warming are actively considering - or actively developing - nuclear power. But our Prime Minister has decided that we are not even allowed to talk about it!

"When he was in charge of the Ministry for the Environment, Barry Carbon told me that 'Kyoto is all about politics, not science'. Exactly the same thing can be said about our energy strategy," Mr Leyland concluded.

ends

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