Tuesday, December 06, 2005

The RMA and energy supply

Aaron Bhatnagar responds to today's scare-story in the Press about the firing-up of the Whirinaki backup station to cover a temporary spike in electricity prices with a kneejerk call for us to

get serious about energy generation and ask our legislators to make it easier for power companies to build power stations

In other words, gut the RMA. But the problem isn't legislative barriers to new construction; it is (or rather, was) the market. It takes time to build a power station, and the current supply is dictated by decisions made five or so years ago. And five years ago, the electricity market actively discouraged new construction. Generators could make windfall profits from the spot market during a shortage, and any new generation or security of supply was seen as diluting this. Thus, not much got built.

Since then, the government has reformed the market - most notably by having a backup station which will kick in whenever the price gets too high - and this has provided a stable environment in which the right investment decisions are being made. New power stations are being built - almost 600 MW in the next two years off the top of my head - and more are currently in the consents process. But it will take a while for the new generation to come on-stream, and in the meantime we run the risk of a shortage if the southern hydro-lakes don't fill on time. There is little policy-makers can do about this; all we can do is wait and see.

But what about the future? The fact is that we are more than meeting our expected demand growth under the current arrangements. Gutting the RMA to encourage more projects is thus unnecessary; all it will do is supplant current environmentally sustainable projects with environmentally unsustainable ones. Business may get cheaper electricity, but they will get it by dumping the environmental costs on the rest of us. And I don't see any reason at all why we should let them do that.


Oh Dear, Aaron is at it again.
The spot price on 4Dec 2005 was10.67,10.74 and 11.39 cents per kwh based on Otahuhu,Haywards & Benmore.The Price index was 12.36
a year ago it was 4.17.
The lake storage for hydro production was 1602 GWh ,60% of average , the inflows were at 51.7GWh/day, 61% of average . A year ago they were 103% of average.
If you want more facts go to www.comitfree.co.nz.

The RMA bleat by Aaron is a standard National Party
mantra. They hate the RMA because it makes developers take their time and ensures that they can't run roughshod over everyone.

They seem to very easily forget that it was the National Party and their very own Max Bradford that created the market based debacle that we have now.
BTW the clip shown on TV tonight of an intake and a lake was Lake Tekapo and the clip is several years old when the Southern lakes were in trouble. They use it every time they want to wind up the general public .

Posted by Anonymous : 12/06/2005 09:16:00 PM