July 2022
Industry update: what we're seeing
In late June, Transpower announced a grid emergency, due to a sudden and unexpected drop in wind speeds, which saw wind farms generate only 2.9% of their total capacity.
This drop in generation was accompanied by mechanical and electrical issues at the Stratford and Huntly plants.
Thankfully, blackouts were prevented by the use of ripple control. However, Transpower warned that further generation shortfalls could be expected in the coming month.
Our press release on the latest emergency highlighted the importance of investor confidence in the natural gas sector, as the fuel plays a crucial role in enabling renewable sources of electricity. This commentary was picked up by BusinessDesk, Newstalk ZB, and Today FM.
Associate Professor Michael Jack from the Otago Energy Research Programme also noted that these sorts of outages could occur more
frequently than initially anticipated. In an interview with Today FM, he explains that this will be due to the variabilities of renewable energy.
Yesterday MBIE published its annual release of petroleum reserves data. It noted a 5.1% decrease in Proven plus Probable (2P) reserves. Unless there is further investment in natural gas production, MBIE believes these reserves would last for 10 more years.
Again, our press release noted the importance of continued investment to ensure natural gas keeps flowing. Despite policy headwinds, companies such as OMV, Beach Energy, and Todd Energy have continued to invest in existing fields to help maintain a reliable supply of natural gas.
Stable, predictable policy settings give more certainty to investors and encourage them to increase generation capacity. Poor energy security is a choice.
Skills plan launched
On 5 July, we joined Social Development and Employment Minister Hon Carmel Sepuloni in Waitara to launch the Taranaki Regional Workforce Plan.
We are proud to have worked in collaboration with the Taranaki Regional Skills Leadership Group to bring about this workforce plan.
The energy sector plays a hugely important role in New Zealand, and in particular the Taranaki region. This workforce plan and our collaboration will help ensure the energy industry and the people of Taranaki have the skills required for our transition to a low-emissions energy economy.
Stuff covered the launch of the workforce plan and carried our commentary on its importance for the energy sector.
Energy in the media
Business Central's July 2022 edition, Energy Options, takes a deep dive into New Zealand's energy sector and the organisations operating in it.
We were pleased to be able to provide Energy Resources Aotearoa's perspectives on the energy sector for the magazine's leading article.
Other articles also mention firms operating in the energy sector, including our members OMV, Atlas Professionals, Port Taranaki and Methanex.
Meet the CEO event
On Tuesday 5th July 2022 we hosted an exclusive event with Stuart McCall, Managing Director of Methanex New Zealand.
Stuart provided the audience with an overview of Methanex New Zealand's operations and explained how there is increasing demand for methanol as a low emissions fuel for vehicle and marine use.
Thank you, KPMG, for kindly hosting this event.
Leveraging our energy resources
Shortly after the release of the New Zealand Infrastructure Strategy, the Infrastructure Commission has released a further technical paper specifically on energy.
The report, 'Leveraging our energy resources to reduce global emissions and increase our living standards', is optimistic about the untapped wind, solar, hydro and geothermal resources available throughout New Zealand.
The Commission argues that our resource management system needs to keep up with new technologies, and makes the case for more permissive building and consenting regimes to allow the construction of large-scale renewable generation such as wind farms.
As with the previously released New Zealand Infrastructure Strategy, the Commission is largely silent about who would pay to develop the abundant resources they have identified - or whether such developments would be commercially viable.
Further thoughts on the ERP
Since the release of the Emissions Reduction Plan in late May, Energy Resources Aotearoa has been analysing in detail the report and its technical annexes.
We are concerned that very little information has been provided about the underlying assumptions of the ERP, nor the likely costs and benefits of the initiatives it proposes.
The ERP is a departure from an ETS-led approach to net emissions reductions. While there may be a role for additional measures to complement the ETS, in most cases the ERP doesn’t provide the evidence and analysis to justify these.
Read our recent submission to Parliament's Environment Committee on the Government's first Emissions Reduction Plan. We also intend to speak to the submission.
Member profile: SenateSHJ
SenateSHJ is New Zealand’s leading communications consultancy with extensive experience in the energy and resources sector. We provide government relations, and stakeholder and media relations advice to clients in the sector.
We pride ourselves on our work, our people and our industry.
Founded in 2002, SenateSHJ has grown to become one of Australasia's most successful independent consultancies, with offices in Wellington, Auckland, Sydney and Melbourne.
We have won multiple awards, including Large Consultancy of the Year at the 2022 Public Relations Institute of New Zealand Awards. We are ranked in the top 250 PR agencies in the world in the latest Holmes Report.
Contact Raphael Hilbron, Managing Partner, on raphael@senateshj.co.nz, or +64 21 605 371
