Lower gas production results in significantly higher emissions

Analysis released by the Ministry of Business, Innovation and Employment (MBIE) highlighting the continuing decline in New Zealand’s natural gas production shows urgent action is required to secure our energy future.

Energy Resources Aotearoa Chief Executive John Carnegie says recent steps by the Government to drive further investment in the oil and gas sector are encouraging, but a worrying picture is emerging.

In January, Transpower’s Winter 2024 Outlook warned of the potential of winter blackouts and MBIE’s Energy Quarterly has now highlighted that lower production has led to more coal-fired generation to meet demand. Mr Carnegie says we are on the brink of significant energy security of supply issues this winter.

"It is now also clear that the previous government’s policies have resulted in the sector burning more high-emitting imported coal than before. If we don’t close the widening gap in our domestic energy supply, New Zealand will be left with only high-emission coal to support intermittent renewables during winter. This, or importing LNG, will be likely to become our reality on our current path."

MBIE's analysis, which points out that lower gas production leads to a need for more coal-fired electricity generation, is rightly ringing alarm bells in the sector.

"What alternative renewable energy source at scale can affordably and reliably fill the energy gap our lower gas production will leave?"

Mr Carnegie says we urgently need solutions that match the damage done to the sector to avoid higher emissions and to keep Kiwis warm through winter.