The Greens, electricity & sustainability

Written By: - Date published: 2:15 pm, April 16th, 2013 - 48 comments
Categories: climate change, cost of living, david shearer, greens, labour, Privatisation, privatisation, public transport, russel norman, sustainability - Tags:

Stuff’s report about the joint Labour-Green electricity announcement on Thursday, says that the policies of the parties will have similarities and differences.

Today, Shearer and Green Party co-leader Russel Norman said they would hold a press conference on Thursday.

“The reason we’re doing this is because we both share the same ambition to bring down electricity prices,” Shearer said.

The policies had similarities and differences, he said.

So I will be hoping to hear something about sustainability from the Greens, given it is a big part of their main energy policy, which says:

Improving energy system planning and co-ordination

The Green Party will:

  • Redesign the Electricity Commission as a Sustainable Energy Commission with regulatory responsibility for all fuels.

  • Require an urgent independent review of Transpower’s planned grid upgrade with a view to developing alternatives that have less impact on the environment and better facilitate a sustainable energy system.

  • Ensure that all major capital projects are tested against sustainable alternatives such as energy efficiency, fuel switching, renewable generation, load shifting and distributed generation.

  • Investigate introducing ‘progressive pricing’, whereby the more energy you use, the more you pay, above a certain base level.

In 2010, debating the government’s Electricity Industry Bill, Kennedy Graham said:

We contended that the underlying challenge was missing. This was the need for a genuine regulatory framework that would make the playing field level for more sustainable renewable energy. We said that the Government was in danger of missing the whole point.

I will be looking to see how the Greens will incorporate plans to keep electricity prices down, while also working towards use of more renewables, and sustainable use of energy.

In my view, sustainability requires a change in mind-set in how we use electricity: that includes better public transport and less focus on promoting a consumer society.

48 comments on “The Greens, electricity & sustainability ”

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  1. Rich 1
    16 April 2013 at 2:22 pm

    The way to package this would be a guarantee that for an average household (say < $150 of electricity a month), electricity prices would be cut in the first two years of a Green/Labour government and then pegged to inflation.

    I also think that the core goal should be to get to 100% renewable electricity and then start replacing static and transport users of fossil fuels (dairy factory boilers, diesel railways and the like). Realistically, that means more wind, pumped storage and a bit of hydro.

    • Lanthanide 1.1
      16 April 2013 at 7:36 pm

      “I also think that the core goal should be to get to 100% renewable electricity and then start replacing static and transport users of fossil fuels (dairy factory boilers, diesel railways and the like). Realistically, that means more wind, pumped storage and a bit of hydro.”

      And more expensive power than what we’re currently paying.

      • Rich 1.1.1
        18 April 2013 at 12:02 pm

        Why? Currently our power is priced artificially, but linked to the cost of coal and gas, which can be expected to increase steadily as fossil fuels become increasingly short and carbon charges are imposed (through taxes on our exports if we try and opt out of international coorperation).

        Renewable power has two cost inputs, the capital in the plant and the wages/consumables to operate it. That’s much more controllable than fuel costs.

        If we reach 100% renewables we’ll have a major competitive advantage of low stable power prices while overseas countries have high and fluctuating ones.

  2. Peter 2
    16 April 2013 at 2:24 pm

    Hmm. Sustainability vs resilience? That may seem like a semantic argument, but we cannot replace fossil fuels with any combination of renewable technology, so whatever regulatory body the Greens propose needs to be aware of this.

    Of course, this is politics, and most of the public is wedded to the idea of ever increasing primary energy supplies and progress, so even the Greens need to tread softly here. If you think climate change arguments are hard, try challenging people on energy supply concepts – you can get a very violent reaction.

    • Draco T Bastard 2.1
      16 April 2013 at 9:17 pm

      but we cannot replace fossil fuels with any combination of renewable technology

      Not within the same paradigm but we can if change the paradigm. No more cars, trucks limited in range and use of bio-fuels, trains and buses run on electricity. Factories run on electricity already. Farming’s a little difficult but I reckon we could convert them over to electricity as well – we just wouldn’t have as many of them.

  3. Pete 3
    16 April 2013 at 2:25 pm

    Investigate introducing ‘progressive pricing’, whereby the more energy you use, the more you pay, above a certain base level.

    If this is introduced, it had better be on a regional and maybe even seasonal basis. I’d warrant that households here in Dunedin in the winter must of neccesity use more electricity for home heating than their counterparts in warmer parts of the country.

    • One Anonymous Knucklehead 3.1
      16 April 2013 at 2:52 pm

      I doubt the policy would apply to domestic users. If prices come down overall that would offset any regional imbalances.

      • Shane Gallagher 3.1.1
        16 April 2013 at 3:01 pm

        No – it is directed at domestic users – we are very conscious of fuel poverty and this is part of the policy framework to address this issue.

    • geoff 3.2
      16 April 2013 at 3:07 pm

      Pete, if you look at the historical data, average annual electricity usage by households has been incredibly static. South Islanders generally do use about 1000-2000kWh more than North Islanders because of extra heating but the difference might be less than you expect because Nth Islanders tend to use more A/C than Sth Islanders.

      The Green’s idea sounds like it might be similar to my electricity rebate idea. You get a parcel of electricity for free (~7000-9000kWh) and then you pay for anything over that.
      I’m sure neither the Green’s or Labour will go that far, which is a shame, and if the Green’s progressive pricing idea has any similarity then, I imagine, they will make the parcel of energy you receive just cheaper, not free.

    • Lanthanide 3.3
      16 April 2013 at 7:38 pm

      That is in fact already the case, Pete.

      There is a “low user” tariff that I believe all power companies must offer. The treshold to be considered a “low user” is something like 8000 kwh in the North Island and 9000 kwh in the South Island.

  4. Populuxe1 4
    16 April 2013 at 3:01 pm

    I have yet to see the Greens address the impact of turbines and tidal generators on bird and marine life, which is interesting because we have already seen how hydroelectric dams impact the environment. Or indeed the practicalities of where exactly we would put big solar farms. It all ends up looking like hypocrisy and political hand waving after a while.

    • geoff 4.1
      16 April 2013 at 3:10 pm

      Fuck off ya nonce.

      [lprent: Explain why you think that. Otherwise I tend to view it as being pointless abuse. If you read the policy, you’ll find that I ban for it. You just got your warning. ]

      • Populuxe1 4.1.1
        16 April 2013 at 3:22 pm

        Why? For mentioning the elephant in the room. Aw, did I kill Santa Claus?

        • geoff 4.1.1.1
          16 April 2013 at 3:30 pm

          For trying to derail the comments.
          Oops Mustn’t. Feed. The. Troll.

          • infused 4.1.1.1.1
            16 April 2013 at 10:13 pm

            Pretty legit question

            • geoff 4.1.1.1.1.1
              17 April 2013 at 2:58 pm

              And I answered it. I told him to fuck off (ya nonce) becos he was doing the standard right wing(nut) lame-arse tactic of trying to divert the comments because he has no answer to the main points of the post.

              • Populuxe1 …
                17 April 2013 at 3:24 pm

                ‘Cept I’m not right wing – just bemused by all the contradictions in Green policy. The environment is an absolute priority, but with the Greens it;s al feel good promises and very little brass tacks. They are becoming increasingly more like Labour.

    • vto 4.2
      16 April 2013 at 3:50 pm

      Yes have wondered about the effects of say the kaipara harbour mouth tidal generators on the sand through which it passes. Surely the sandy mouth will simply shift to the side of the generators which will disappear under the sand.

      • Peter 4.2.1
        16 April 2013 at 3:58 pm

        That’ll be why the Environment Court ordered a staged approach for the Kaipara project, with adaptive management.

        There are risks with marine power, but they aren’t high enough to warrant saying no, given the huge opportunities to get on with powering this country with renewables.

      • lprent 4.2.2
        16 April 2013 at 6:59 pm

        Nope. The current around the Pouto through to the heads is extremely deep, has bugger all sand near the bottom because of the current speeds, and won’t move because of a few harbour bottom obstructions because of the orientation of the harbour mouth.

        My grandparents had a bach at Pouto and we used to damn near live there when we were kids in summer. Used to dive at the turn of the low tide, fish for breakfast at the canyon at the beach shore, and got caught out in a dinghy with a running tide for several hours praying the anchor wouldn’t drag when the seagull died and we had no way of getting us to shore.

        It is a different kind of harbour. The amount of water washing in and out of those narrow heads is immense. It tends to obey rock and bugger all else is ever going to affect it.

  5. Shane Gallagher 5
    16 April 2013 at 4:03 pm

    No but a little fact-fairy dies every time you talk rubbish… here are the estimated stats from the US.

    The year is the year of the estimate, the first number is the low side estimate and the second number is the high side estimate. You will note that cat-kills are not included here – just man-made stuff. The number of bird kills, while regrettable, is vanishingly small compared to, say, glass.

    Collisions with:

    Wind turbines 2009/10 100,000 (2010) 440,000 (2009)
    Towers 2008 4,000,000 50,000,000
    Power lines 2001 10,000,000 154,000,000
    Roads/vehicles 2005 10,700,000 380,000,000
    Glass 2006 100,000,000 1,000,000,000

    [lprent: Reply to this. I do wish that people would learn to use the reply buttons. But interesting – I made it into a table so I could read it more easily ]

    • Murray Olsen 5.1
      16 April 2013 at 6:10 pm

      Thanks for those numbers SG. With the rage the right wing nutters get into about bird deaths by turbine blades, I could never understand how the blades could stay white and the area around a windfarm could be anything but a bloodied swamp.

      • Lanthanide 5.1.1
        16 April 2013 at 7:41 pm

        It’s a coverup, clearly.

        • Murray Olsen 5.1.1.1
          16 April 2013 at 8:49 pm

          Obviously. The stuff in the chemtrails cleans them whiter than white. It’s no accident that the TSA Federal Air Marshal Robert MacLean and the toothpaste have the same name. This goes deeper than I’d suspected.

      • Draco T Bastard 5.2.1
        17 April 2013 at 12:52 pm

        There’s an easy solution to bird kills from wind farms – build them out to sea. Comes with other benefits as well such as the fact that the pylons the wind turbines are built upon will act as artificial reefs and that the area covered by the wind farm cannot be trawled for fish making it an automatic marine reserve.

  6. DH 6
    16 April 2013 at 4:20 pm

    I’m waiting with bated breath but I don’t have high expectations.

    One of the reasons we have high power prices is because the power companies have all revalued their generation assets upwards each year to portray a ‘fair market value’. Mighty River Power has equity of $3.014 billion dollars. Of that equity $1.86 billion is ‘asset revaluation reserves’ which is roughly how much they’ve ramped up the value of their generation plants since being made an SOE. That’s tax-accounted too, there’s an extra $720million in deferred tax on those revaluations.

    That reserve represents well over half of their required return on equity, at 7% ROE we’re talking an extra $130million in profits. And that’s just one of them, Meridian has revaluation reserves of $3.39 billion.

    The sharemarket value of these power companies is a factor of their profits. Any cut in power prices comes from the top, a small cut can mean a large fall in profits. A 10% cut in the average selling price for Mighty River would be a 33% fall in EBITDAF and more than a 50% fall in nett profit which would result in a corresponding 50% fall in the share price. I can’t see Labour or the Greens going that far so I expect we won’t see any real cuts for most of us.

    • Colonial Viper 6.1
      16 April 2013 at 7:03 pm

      One of the reasons we have high power prices is because the power companies have all revalued their generation assets upwards each year to portray a ‘fair market value’.

      Just destroy the book value of the companies in a one hit write down then. One way to do that is to poison pill every electricity company with conditional debt.

      • DH 6.1.1
        16 April 2013 at 7:34 pm

        Yeah you could do that but those power companies are assets on the Crown’s books, any writedowns would increase the Crown deficit. They’d really need to unwind all the revaluations too which includes the lines companies like Vector, fully privatised powercos like Contact, and Transpower. All up I wouldn’t be surprised if there’s nearly $15billion in revaluations that have already been booked & spent by Cullen & English. It’s a lot of money and we don’t have it any more.

        We’re paying the price of putting beancounters in charge of the nation’s finances.

        • Colonial Viper 6.1.1.1
          16 April 2013 at 7:41 pm

          Bean counters in charge of the nations finances would have been fine

          Instead we put Wall St types in charge.

          Yeah you could do that but those power companies are assets on the Crown’s books, any writedowns would increase the Crown deficit.

          It’s simple a ledger entry. It has zero effect on cashflow and unless some financing asset backing conditionalities apply, I can’t see that there would be any fiscal impact.

          • DH 6.1.1.1.1
            16 April 2013 at 8:09 pm

            Jesus. Get real, after English’s borrowing spree the nation’s nett worth is only about $60 billion as it is now. Knock another $10-15 billion off that & see what our financial situation would end up like.

            That $15billion has all been spent as real money, Cullen & English booked it as paper (ledger) gains and then borrowed against it or called it a surplus which they then spent.

            It’s not Wall St types who got us into this mess. It was accountants.

            • Colonial Viper 6.1.1.1.1.1
              16 April 2013 at 8:14 pm

              Nonsense

              Fuck this “nett worth of the nation” concept, it’s an irrelevant abstraction that the markets don’t give a shit about. It’s not even what the bond vigilantes look at because that’s not how sovereigns are financed.

              In other words, the sovereign is not a home owner going to the bank manager trying to get a second mortgage based on the equity they have left in their residence.

              It’s not Wall St types who got us into this mess. It was accountants.

              What the fuck are you on about? They may have had accounting degrees yes, but the people who got us into this mess are Financial Engineering Treasury types, not bean counters.

  7. Rich ,the other 7
    16 April 2013 at 6:39 pm

    Might be a problem for the greens on this one, green power (wind turbine) is a very expensive way to generate electricity.
    If power prices are to be forced down, expensive wind generation will go out of business and be replaced by coal fired generation.

    [lprent: You really should remember how to type in your handle so the overworked mods don’t have to release it. ]

    • Draco T Bastard 7.1
      16 April 2013 at 9:13 pm

      Might be a problem for the greens on this one, green power (wind turbine) is a very expensive way to generate electricity.

      Far, far cheaper than relying on imported fuels forever.

      If power prices are to be forced down, expensive wind generation will go out of business and be replaced by coal fired generation.

      Nope, long term renewables are always cheaper than non-renewables.

      • Rich the other 7.1.1
        16 April 2013 at 10:04 pm

        Rubbish,
        No need to import anything, we have a thousand years of coal just waiting to be burned in our power stations and its very low cost, using coal the price electricity would fall by about 33%,
        that’s why Japan and Germany are converting to coal fired generation.

        Wind power only exists so power company’s can trumpet there green credentials, its not cost competitive.

        • Draco T Bastard 7.1.1.1
          17 April 2013 at 11:02 am

          You’re forgetting the cost of Climate Change that burning coal and other fossil fuels has. A cost that wind power and other renewables don’t have. This is why we must start taxing the burning of fossil fuels – to make the economics of doing so meet the actual cost. Once we do that then, lo and behold, wind and other renewables are cheaper.

          You want a market system? Then you need the costs to be properly charged for.

          • Rich the other 7.1.1.1.1
            17 April 2013 at 3:26 pm

            So you think that by forcing up the cost of fossil fuels that this will some how produce the cheaper electricity .
            On climate evolution ,
            please explain the cause of the creation of the sahara desert, it certainly wasn’t man made.
            .

  8. Colonial Viper 8
    16 April 2013 at 7:05 pm

    The Greens: “We’re going to review this, investigate that, rescope this and report on the other.”

    FFS the Greens are turning into Labour.

  9. millsy 9
    16 April 2013 at 10:50 pm

    Wind and solar are more suited to small scale niche applications, rather than powering things like smelters and hospitals. Examples can include remote communities, solar street lights, and the like.

    Im not expecting anything to radical from this announcement. The best I am hoping for is for a return to some sort of central co-ordination and planning, and allowing lines companies to own generation and retail assets (and vice versa).

    • Tiresias 9.1
      17 April 2013 at 10:16 am

      I, too, expect little of consequence. Labour might have the credibility but don’t have the vision. The Greens have the vision but don’t have the credibility. The solution to that is obvious to everyone, but is also anathema to politicians of any stripe.

    • Draco T Bastard 9.2
      17 April 2013 at 11:07 am

      Wind and solar are more suited to small scale niche applications, rather than powering things like smelters and hospitals. Examples can include remote communities, solar street lights, and the like.

      Put an average 1KW of solar generation on each house in the country. That’s about 1.5GW of generation. I suspect that’s capable of doing more than niche stuff although what it would actually do is free up the power from the main generators to be used for other stuff such as factories and public transport.

      • DH 9.2.1
        17 April 2013 at 1:58 pm

        “Put an average 1KW of solar generation on each house in the country. That’s about 1.5GW of generation. ”

        Now you’re getting the hang of it, although 2-3Kw is better you just don’t save quite enough with 1Kw and it costs little extra to install more. 1KW of panels will generate around 1.2 Mw/hr annually on a reasonable site and use about 6.5 sq metres of roof space. That’s $300-350 worth of power.