Coconut trees fall onto the beach as rising sea levels erode their bases on Tuvalu
Carbon specialist Kent Duston has slammed Tiwai Point’s environmental economics. He claims the opportunity cost of using renewable Manapouri power to supply the aluminium smelter instead of replacing carbon-emitting Huntly will cost $225,000 per Tiwai worker per annum.
It would be cheaper for the New Zealand taxpayer to pay every single Tiwai Point worker and contractor $200,000 per annum for the rest of their lives to simply stay home. New Zealand Herald.
Energy efficiency is an area where New Zealand needs to put in more effort. OECD expert Richard Bradley says
Efficiency is and will remain our greatest source of energy.
OECD countries on average use one third less energy per unit of economic output today than they did in 1973. But New Zealand uses more, because of the energy we use to manufacture low value goods. Firing-up of the Tiwai Point Aluminium smelter has no doubt had an impact on our average.
Remember Rob Muldoon’s “Think Big” Strategy? Younger readers will be appalled to know that our Government of the early/mid 1970s believed New Zealand’s future lay in big capital cost, energy-intensive, industrial development schemes. The Huntly Power Station (fossil fuel thermal), Manapouri Hydro-plant and the Tiwai Point aluminium smelter are examples of projects that survived the outcry from us Greenies at the time.
I call it “Tiwai Point” as its brand name seems to change more and more frequently, with its foreign ownership. I wouldn’t want this book to date too quickly. Once long known to New Zealanders as “Comalco”, it then became “Rio Tinto”. Now it’s hard to know exactly when it might be written in Chinese. That’s probably inevitable though, given the sovereignty threat we have bought ourselves by building up huge levels of foreign debt.
Regrettably these Think Big structures failed to reverse New Zealand’s slide down the global charts in terms of per capita GDP. Environmental costs aside, we had really only just finished paying off the national financial debt they threw us into by careful and painful economic management from respective Governments through the 1980s and 1990s. Then this decade Kiwis got real estate fever again and rapidly re-established that debt burden. To be smarter ecologically we must also be also be smarter economically. Good ecology is good economics.
The Manapouri hydro project, subject of John Hanlen’s local hit song, was constructed primarily to supply cheap power to the aluminium smelter. As we learnt in primary school, New Zealand doesn’t have any aluminium raw material (bauxite) of our own. The concept was to import that from Australia, add value to it by applying our cheap electricity, and then re-export the finished aluminium, largely to Japan.
Somewhere along the way ownership of the smelter passed into foreign hands. That creates a Catch 22 situation. What would actually happen for example if the smelter model was an economic knock-out, say of the kind that might potentially improve New Zealand’s relative GDP per capita? The considerable profits of such a venture would now largely be repatriated to overseas owners, leaving our relative GDP little better off. It appears we paid the environmental price of the Manapouri Dam and then sold any chance we had of significant economic gain as well. Damn the dam indeed.
Of course we do need foreign investment. We just need to get a lot smarter in ensuring we get the ecologic and economic kick-start we need from it.
Internationally the Manapouri project has been praised for attention paid to mitigate environmental concerns.
Hydro dams can be large and unsightly. However, a creative solution to this was found when the Manapouri power station in New Zealand’s South Island was constructed in Fiordland National Park (this includes the famous Milford Sound and was the location for several scenes in the Lord of the Rings films). This hydro electricity station was constructed underground and mostly out of sight.
However, the Manapouri hydro project itself was never able to deliver fully to the planned output of electricity. One theory is that a big bulldozer was left behind in the water-race tunnel, reducing the volume and impact of the water-fall on the turbines. Prior to Roger Douglas’s 1980s overhaul of the Public Service, an outfit called the “Ministry of Works” supervised construction projects like this. It was infamously inefficient. New Zealanders themselves used to joke about how many workers it took to lean on one shovel. But no point crying now over spillways. Sunk costs.
Things have changed a lot since the centralised planning days of Think Big.
In the sense that most people think of a central plan, the industry doesn’t have one. In my view the nation is better protected against the cost of over-building, and the risks of shifts in technology and rising operational costs, by requiring generators to invest at their own risk – without any protection for incumbents.
says David Caygill, Chair of the Electricity Commission.
In its 2008 Statement of Opportunities, the Electricity Commission has fun outlining several future scenarios. How about this one, called “Sustainable Path”?
New Zealand embarks on a path of sustainable electricity development and sector emissions reduction. Major existing thermal power stations close down and are replaced by renewable generation, including hydro, wind and geothermal backed by thermal peakers for security of supply. Electric vehicle uptake is relatively rapid after 2020. New energy sources are brought on stream in the late 2020s and 2030s, including biomass, marine, and carbon capture and storage (CCS). Demand-side response helps to manage peak demand.
Now that’s what we need to gun for to raise our Green Energy score.
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