October 2021
From Upstream to Energise Online
Eagle-eyed readers will note this newsletter now has a new name: Energise Online.
We've changed from our previous name 'Upstream Online' to recognise the broader focus Energy Resources Aotearoa now has, and our new members who include major energy users and distributors.
This reflects our new strategy of being the voice of a successful and resilient energy resources sector. We are working to achieve a balanced energy system that makes New Zealand a better place, through and beyond the transition to lower emissions.
Global energy crisis worsens
A global energy crisis is spreading with skyrocketing prices and warnings that "people are going to die of cold."
Oil prices have doubled in recent months, gas prices are not far behind and demand for coal is surging - up 23% in the US this year alone.
Causes include the global economic recovery from Covid-19, under investment in fossil fuels, and the inability of renewable sources to keep up with seasonal demand.
As The Economist notes, "The panic is a reminder that modern life needs abundant energy: without it, bills become unaffordable, homes freeze and businesses stall."
Reports highlight energy and climate challenges
Four new reports this month have highlighted the major challenges for New Zealand - and the world - in reaching our emissions targets while keeping energy affordable and reliable.
- Gas Market Settings Investigation by the Gas Industry Co (GIC) finds that policy uncertainty is undermining the gas investment we need to transition smoothly. This is consistent with what Energy Resources Aotearoa has been saying for some time now.
- NZ Gas Infrastructure Report by the Gas Infrastructure Working Group, which looks at the impacts of a move away from natural gas to new ‘greener’ gases, or electrification which could cost consumers $5.3 billion.
- Transitioning to a low-emissions and climate resilient future is the Government’s discussion document with ideas to include in the Emissions Reduction Plan, due in May next year. In our view the goal is laudable but the proposals are costly and ineffective compared to greater use of the ETS.
- World Energy Outlook 2021 from the International Energy Agency (IEA) models future energy trends. It finds the world is dealing with an energy crisis and at the same time, struggling to decarbonise and unlikely to meet the goal of net zero emissions by 2050.
We have prepared detailed analysis of these reports for our members and what they mean for the energy sector. If you are interested in joining and receiving this work, the relevant forms are here and a new brochure on the benefits of membership is here.
New Zealand's trilemma ranking slips
The World Energy Council has rated New Zealand 9th in their annual energy trilemma framework, which ranks countries on how they balance the three key elements of energy security, equity, and sustainability.
"It’s pleasing to see we are still in the world’s top 10 overall, but it’s a real worry to see our energy security rating slip to 28th," says chief executive John Carnegie.
"Based mainly on 2019 and 2020 datasets, this year’s ranking will only get worse when the events of this chaotic year in energy are included.
"As highlighted by the various reports discussed above, all three legs of the ‘energy trilemma’ – security, affordability and sustainability – are looking very shaky both in New Zealand and around the world."
Every month we'll be profiling different Energy Resources members, highlighting the range of skills and services in our local industry.
Member profile - SGS
SGS is the world’s leading testing, inspection and certification company. With 93,000 employees around the world, they provide specialised solutions to make your business faster, simpler and more efficient.
Their work helps global commerce flow smoothly by ensuring that products are safe and meet the standards required.
Here in New Zealand since 1968, SGS works across our markets facilitating export trade and products while working as agents of Government regulators including MPI, MNZ, NZTA, and WSNZ.
SGS has been involved for many years in the oil and gas sector providing independent statutory and other regulatory inspection, testing, verification and certification services to members.
They have worked in all production geographies in New Zealand and have many times supported producers with overseas support services to ensure compliance of imported operating assets.
SGS New Zealand has 29 branch offices across the country available to service member’s needs.
