‘Extreme complexity’ of energy policy highlighted in ComCom decision – Energy Resources

Today’s Commerce Commission decision to allow accelerated depreciation of natural gas pipeline infrastructure highlights the complex trade-offs we will need to make to achieve net zero carbon emissions by 2050, says Energy Resources Aotearoa.

John Carnegie, Managing Director of Energy Resources Aotearoa, says:

“The Commerce Commission had the unenviable task of balancing the interests of pipeline owners and gas users, in an environment of significant uncertainty about the government’s future plans.”

Carnegie says today’s decision shows why the government should preserve stable and predictable energy policy parameters, rather than stoking ambiguity and uncertainty.

“The decision is a wake-up call to the government that its words and decisions have far-reaching consequences for businesses and households. The government has rightly backtracked on the Climate Change Commission’s proposed ban on new gas connections, but the specter of intervention nevertheless persists in the proposed gas transition plan.

“Without a government commitment to a market-led transition, it has been left to the Commerce Commission to make tough decisions about the life of natural gas assets.”

Energy Resources Aotearoa has reaffirmed its position that New Zealanders will be best served by having a wide range of energy options.

“There are a wide range of pathways to net zero, and many will include a sustained role for natural gas as a key enabler of renewable electricity. Market players are also actively exploring opportunities for renewable gas to leverage existing natural gas assets. Energy users respond to price signals through the emissions trading system and switch on their own to low-carbon energy sources.

“We cannot centrally plan our path to net zero carbon emissions by 2050 without imposing extremely high costs on businesses, consumers and taxpayers.”

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Sharon D. Cole