'Extreme complexity' of energy policy highlighted in ComCom decision

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

John Carnegie, Chief Executive of Energy Resources Aotearoa, says:

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

Carnegie says today’s decision shows why Government should preserve stable, predictable energy policy settings, rather than fuelling ambiguity and uncertainty.

"The decision is a wake-up call for Government that their words and decisions have profound consequences for businesses and households. The Government rightly walked back from the Climate Change Commission’s proposed ban on new gas connections, but the spectre of intervention nonetheless persists in the proposed Gas Transition Plan.

"Without a commitment from Government to a market-led transition, it has been left to the Commerce Commission to make difficult decisions about the asset life of natural gas assets."

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

"There are a wide range of pathways to net zero, and many will feature a sustained role for natural gas as a key enabler of renewable electricity. Market participants are also actively exploring possibilities for renewable gas to leverage existing natural gas assets. Energy users will respond to price signals through the Emissions Trading Scheme and move to lower-carbon energy sources of their own accord.

"We cannot centrally plan our way to net zero carbon emissions by 2050 without imposing extremely high costs upon businesses, consumers, and taxpayers."