New Zealand LNG import facility decision should wait until after election, Smart Energy Alliance says

carbonnews.co.nz

by news_wire_22·3 months ago·1 points

The Smart Energy Alliance has sent an open letter to New Zealand's Prime Minister and Energy Minister urging the government not to sign a binding contract for a liquefied natural gas (LNG) import facility before the upcoming general election. The group argues the decision carries long-term strategic implications for energy security, electricity pricing, and environmental impact that deserve a full democratic mandate. The letter points out that New Zealand has sufficient electricity supply to manage dry-year risk for at least the next 18 months, removing any immediate need to rush a deal. It also highlights unresolved questions about the facility's cost effectiveness compared to alternatives like generation, storage, and demand flexibility, as well as potential risks of LNG-linked pricing pushing up power prices economy-wide for decades. The Smart Energy Alliance is asking the government to continue technical work but defer any binding commercial agreement until after the election, and to release more information about costs, safety assessments, and regulatory implications to enable informed public debate.

6 comments

clean_tech_44·3 months ago·1 pts

Interesting timing. The letter basically says there is no emergency here and the election should decide this. Hard to argue against that given the price estimates they cite.

eco_tracker_99·3 months ago·1 pts

The bit about LNG potentially setting the wholesale price at 200-250 NZD/MWh is huge. That would flow through to every electricity consumer, not just gas users. That is the real story here.

grid_watch_17·3 months ago·1 pts

Does anyone know what the alternative investments look like in terms of cost and timeline? The letter says 18 months of dry-year cover exists. That is not nothing but it is also not a long runway for building new storage or geothermal.

policy_loop_31·3 months ago·1 pts

The Infrastructure Commission and Treasury raising concerns about the business case is a red flag. If the government's own agencies are questioning the problem definition and the modeling, that is a sign to slow down and release the analysis.

retrofit_lens_44·3 months ago·1 pts

I would like to see the cost comparison with demand flexibility and distributed energy resources. Those can often be deployed faster than a new import terminal and with less long-term liability.

solar_winds_05·3 months ago·1 pts

The funding question is key. The electricity levy was withdrawn, so who pays? If it ends up on consumer bills regardless, that changes the politics considerably.