The power cartel's systematic underinvestment in generation has given us another electricity crisis, and the climate-denying government is using this to push its dirty solutions: new fossil generation, with an LNG import terminal to ensure there is enough gas. Which probably looks very attractive as a temporary stopgap measure. The problem is that once the current crisis is over, the investment in that stopgap measure will effectively be a stranded asset - making it a hugely expensive "solution" to a temporary problem.
Even the polluter lobby seems to understand this, with Energy Resources Aotearoa demanding an "investment guarantee" - otherwise known as a subsidy - for a new thermal power plant. Meaning they know such a plant would have no future; that even if it could secure a supply of gas to keep it operating, the pipeline of consented wind and solar being built will rapidly drive it out of the market, meaning it won't have the usual payback period required for such an investment. Its basically not a commercially viable proposition, even allowing for fossil generation's role as the price-maker and the resulting windfall profits to the power cartel.
The equation for LNG is even worse. Imported LNG is roughly twice as expensive as domestic gas (US$12.37/MBTU = NZ$19.63/GJ, vs NZ$10.97/GJ for industrial users).Methanex, which uses 45% of all our gas, won't want to pay that. Neither will anyone else. The exception being electricity companies, who can pass on those prices and (due to the broken market pricing model) generate windfall profits from them. So it will drive up electricity prices for everyone, but because electricity is more efficient than gas for most uses, will also further drive electrification as well. So, an expensive import terminal to supply fuel to a dying industry, which will increase the speed of death of that industry. Only a fool would pay for it. Unfortunately, as their whole conversation around energy and climate change shows, we are currently governed by fools.
If the government is going to subsidise or promote things to fix the underlying problems in the electricity industry, it could at least subsidise good things: renewables and batteries, or even baseload geothermal. These would increase electricity supply, lower electricity prices by driving fossil generation out of the market, and do so while not cooking the planet. But I guess none of that benefits the government's donors and cronies, so they'll be wasting money subsidising a polluting dying industry instead. But if they so so, the next government can and should repudiate their bullshit, and legislate to recover any wasted money.
