Bryan Leyland

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New Zealand’s Energy Strategy – the good, the bad, and the ugly
Bryan Leyland
9 September 2011

The latest New Zealand Energy Strategy is a strange mixture of pragmatism, ignorance, unachievable aspirations and disregards our biggest energy resource.

The policy on oil and gas is sensible and admirable. Anything that encourages exploration and development of these resources can only be applauded.

But maintaining a strategy for 90% renewable energy–which, technically, is virtually unachievable–really demonstrates an ignorance of the fundamentals of so-called “climate change". The government's belief that man-made greenhouse gases cause dangerous global warming is unsupported by any evidence. It is only hypothesised by computerised climate models which, for the last 20 years, have failed to correctly predict future temperatures. It is supported by many people who, misguidedly, believe that “economic growth is incompatible with the environment". (In fact, as anyone who's been to Africa will know, that belief is the reverse of the truth. Only rich societies can afford to look after the environment.) It is also supported by those with vested interests who hope to make a fortune out of carbon trading and those who are pushing renewable energy or growing forests.

But all that does not alter what the science tells us. It tells us that, in the past, the climate has always changed. There is increasing evidence that sunspot cycles and the number of sunspots are a very strong influence. History tells us that when a short sunspot cycle is followed by a long sunspot cycle – as has just happened – the next sunspot cycle will be cold. The fact that 2011 is colder than 2010 may well be an indication of this. (Because we are in a mild La Nina phase, we can be sure that no significant warming will happen for the rest of the year.) Then there is the declining number of sunspots which, in the past, has always led to cooling. If they disappear altogether, as they did in the two phases of the Little Ice Age, we can expect severe cooling. 

The tragic thing is that the few officials who advise the government on climate change still cling to their faith in models and continue to ignore the sunspot evidence. So we could say that the whole renewable part of the Energy Strategy is driven by the fact that those few key advisers to government have blind faith in climate models. Because of them, millions – perhaps billions – of dollars is being squandered and the economy is being seriously damaged.

On renewable energy, it is always sensible to exploit geothermal resources. It is, in any event, one of our best energy resources. If it were operated under the Crown Minerals Act rather than the Resource Management Act, exploitation would be much easier and the results would be much better. But we are getting to the end of the fields that were explored many years ago and new exploration is necessary. This is expensive and risky.

Windpower is expensive, intermittent and unpredictable. The wind blows least in the autumn when we need it and most in the springtime when it is raining and the snow is melting, so it does not suit our power system. The 600 MW of wind power that we already have is giving our system operators problems in balancing the system. If wind power goes over 1000 MW, these problems will become severe and difficult and expensive to cope with. While it is claimed that our hydropower system can easily balance wind power, it is simply not true. Part of the reason is that environmental restrictions on lake level changes and discharge changes limit the ability to rapidly back up wind power. But more importantly, in a dry year, when the chips are down, our hydropower system has nothing to spare.

The absence of any reference to coal is unsurprising, but very sad indeed. New Zealand has enormous resources of coal and lignite and there is no reason why we should not use them. For instance, Solid Energy is trialling underground coal gasification in the Huntly area. If it is successful then we have a virtually unlimited supply of gas for power generation. Alternatively, we could build a modern lignite-fired power station in the South Island. Modern coal-fired power stations are clean and efficient.

Finally, the Energy Strategy reflects an apparent belief that it is possible to predict the future. Against this, there is the possibility of a major gas find, the possibility of gas from shale and, further out, a possibility of gas from frozen mixtures of water and methane off the East Coast. I do not know what the energy situation in New Zealand will be in 5 years time. Nor does the government.  But it does not stop them trying to “pick winners". It is notorious that when governments do this, they always get it wrong.

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