By: Imogen Edwards
Published: 31/01/2017
The Ministry of Business, Innovation and Employment (MBIE) is calling for submissions on the recently released Draft New Zealand Energy Efficiency and Conservation Strategy 2017-2022 (Strategy).
 
The Strategy complements the New Zealand Energy Strategy (2011-2021) (NZES), the country's primary energy policy, and replaces the 2011-2016 Strategy, which expired in August 2016.
 
The NZES identifies four overarching priority areas, which have informed the development of the Strategy.  These are:
 
1.         Diverse resource development.
2.         Environmental responsibility.
3.         Efficient use of energy.
4.         Secure and affordable energy.
 
With a growing international focus on the crucial role that energy plays in business competitiveness, the Strategy identifies the need to improve New Zealand's energy productivity.  This is defined as Gross Domestic Product (GDP) per unit of energy used, and by raising energy productivity businesses can reduce costs, become more innovative, manage risks, and optimize systems.  The Strategy also aims to reduce emissions by promoting a switch from fossil fuels to renewable energy and to promote new technologies which enable us to use energy more efficiently and at a lower cost.

In order to support New Zealand in becoming an energy efficient, productive and low emissions economy, the Strategy identifies four objectives:
 
1.         Businesses make energy efficient and renewable investments, and adopt best practice energy management.
2.         Individuals choose energy efficient technology, adopt energy efficient behaviours and make greater use of renewable energy.
3.         Public sector demonstrates leadership by adopting greater energy efficiency and renewable energy.
4.         Market participants encourage development and adoption of energy efficient and renewable energy products and services.

These objectives relate to process heat, transport and electricity; the three key priority areas where improvements have been identified, and which are in turn supported by specific targets.
 
The target in the process heat area is to decrease industrial emissions intensity by 1% per annum on average between 2017 and 2022.  Process heat is largely supplied by fossil fuels, and is often used to heat schools, universities, offices and other buildings, and to create steam or sterilisation in hospitals. Process heat makes up one-third of New Zealand's overall energy use and contributes 9% of gross emissions.  As such, the Strategy identifies process heat as "one of our largest cost-effective opportunities to improve energy efficiency and switch from fossil fuels to renewable energy".
 
In the transport sector, the target is for electric vehicles to make up 2% of the vehicle fleet by the end of 2021.  New Zealand's transport system currently relies predominantly on fossil fuels to power vehicles, aircraft, rail and ships, and with growing pressure on the system from our increasing population, the Government has signalled that now is the time to improve our existing infrastructure through more efficient management of our transport fleet. To achieve the target, electric vehicle registrations need to double each year until 2021.
 
Finally, in the electricity sector, the Strategy reaffirms the existing target of ensuring that renewable energy constitutes 90% of the country's electricity supply by 2025.  New Zealand is already well on track to meet this target but other factors such as temperature increases, improved building standards and home insulation, make forecasting progress tricky.
 
From a business perspective, investing in energy efficiency may lead to improvements in competitiveness, lower operating and maintenance costs, better working conditions, and from a marketing perspective, branding advantages.  As such, businesses are encouraged to increase their energy efficiency and uptake of renewable energy sources.  For example, switching to lower carbon fuels, adopting energy management systems, using electric vehicles in the company fleet, and creating a building management system.
 
You can read the Strategy in full here: http://www.mbie.govt.nz/info-services/sectors-industries/energy/energy-strategies/consultation-draft-replacement-new-zealand-energy-efficiency-and-conservation-strategy
 
If you would like to contribute your views or ideas for the Strategy, MBIE has identified a number of consultation questions for you to address in a submission.  Submissions on the Strategy close at 5pm, 7 February 2017.
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