Rising Oil Prices Spur New Zealand To Accelerate Renewables Development

National Economy

New Zealand  has a population of approximately 4.90  million[1]. In 2021, 100% of the people in this island country in the southwestern Pacific Ocean had access to electricity[2].

In 2021, New Zealand’s economy was ranked 50th in the world in gross domestic product (GDP)[3]. The country’s economy is dependent on export[4] of concentrated milk, sheep meat, goat meet, frozen beef, rough wood, and butter.

Environment Policies

In 2006, New Zealand implemented the New Zealand Energy Strategy which set the goal of generating 90% of the nation’s electricity from renewable sources by 2025.

In 2016, New Zealand signed the Paris Climate Agreement[5]committing to a 30% reduction in greenhouse gas emissions by 2030, based on 2005 levels.

In 2020, utilities used renewable energy (78.8 %), natural gas (14.1 %)coal (5.4 %),  and oil (1.7 %) to generate electricity in New Zealand[6]. Hydropower, wind, geothermal, and biomass are the primary types of renewable energy used to generate electricity in New Zealand.

Recent renewable energy projects in New Zealand include:

  • 400 MW Solar Project – In April 2022, New Zealand company, Nova Energy announced plans to build a solar project at a site approximately 200 miles northeast of the nation’s capital, Wellington.
  • 222 MW Wind Project – In December 2021, New Zealand company, Mercury Energy commissioned the Turitea wind project at a site approximately 80 miles northwest of Wellington.
  • 168 MW Geothermal Project – New Zealand utility, Contact Energy is continuing work on the Tauhara geothermal project at a site approximately 175 miles northeast of Wellington. The project is forecast to be commissioned in 2023.
  • 24 MW Hydropower Project – British company, Hydro Developments is continuing work on the Ngakawau Hydro Project which is located on the Ngakawau River in the northern section of the West Coast of the South Island of New Zealand.
  • 1 MW Solar Project  – In June 2021, New Zealand company, Todd Corporation commissioned Sunergise Kapuni Solar power plant at a site approximately 100 miles northwest of Wellington.

Conclusions

New Zealand is a net importer of oil for power generation, heating, and transportation. In 2020, the  nation spent U.S. $1.4 Billion for imported crude oil and U.S. $1.34 Billion for refined petroleum.

On 24 February 2022, Russia invaded Ukraine, resulting in the United States, Canada, and the European Union placing embargos on Russian exports. As a result, the price for crude oil has increased by over 50% from May 2021 to May 2022.

New Zealand has significant undeveloped renewable energy resources, including hydropower, offshore wind, onshore wind, geothermal, solar, and biomass. The dramatic rise in the price of oil is causing New Zealand to accelerate the development of new renewable energy projects.

 

Jack Kerfoot

Website – “Our Energy Conundrum”

www.jackkerfoot.com

 

 

Jack Kerfoot is a scientist, energy expert, and author of the book FUELING AMERICA, An Insider’s Journey and articles for The Hill, one of the largest independent political news sites in the United States. He has been interviewed on over 100 radio and television stations from New York City to Los Angeles on a wide range of energy topics.

 

[1] New Zealand Population (2022) – World Population Review, August 3, 2022, www.worldometers.info

[2] Trading Economics, “Access To Electricity (% of Population) – New Zealand

[3] Gross Domestic Product By Country 2021 – Worldometer

[4] The Observatory of Economic Complexity (OEC) – New Zealand

[5] Carbon Brief – “2015: Tracking Country Climate Pledges”

[6] Our World In Data, New Zealand: Country Profile by Hanna Ritchie and Max Roser

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