Who Benefits is a year-long Newsroom project examining lobbying and influence.
Our current investigation – Power Play – into the electricity industry’s influence will show over the next five days:
- The electricity industry helped formulate the National Party’s Electrify NZ policy
- Lobbying of government officials through a gentailer-heavy industry group, began just days after the National-led coalition Government was formed
- The industry worked on policy proposals with officials for months before other parties, including Māori/iwi, were invited to targeted consultation
- Initially, ministers ordered officials to work specifically with the energy sector
- Central and local government officials pushed back
- Under direction from ministers, policy changes made were strongly directive and enabling of renewable power stations, including re-consenting, but the industry didn’t get everything it asked for
- And Who Benefits? Faster, easier consents for power stations give greater certainty to generator-retailer companies but they’re under no compulsion to build them until demand increases and they stack up financially
- A steep drop-off in investments by majority government-owned electricity companies led to huge dividend payouts being dished out to the state and private shareholders
- Those high dividend levels have continued as power prices rise to levels not seen since before the Bradford reforms in the 1990s
In July 2024, with targeted consultation on Electrify NZ about to start, agencies briefed ministers.
Already, ministers had agreed the policy programme’s intent – to speed up decision-making, craft national direction with a “more certain outcome”, and increase the likelihood of consents for power stations being granted.
In fact, the direction was set before the previous year’s election by the National Party’s policy of the same name – to cut red tape, in the popular parlance, and fast-track new investment – with an overarching goal of doubling the generation of renewable energy (of which electricity is a significant part) by 2050, and help reduce climate emissions.
What would that mean for households and businesses?
“Lower costs and accelerated investment will translate to lower energy bills for households and businesses while supporting growth and the transition to a low-carbon economy,” the National Party’s policy document said.
While changes were mooted to National Policy Statements for Renewable Electricity Generation and Electricity Transmission (renamed to Electricity Networks), the Resource Management Act (RMA) was also being amended.
As foreshadowed in the National Party’s 2023 press statement, it wanted to “turbo-charge” new renewable power projects by requiring consent decisions to be issued within a year, and for consents to last 35 years, with untriggered consents expiring in 10 years instead of the usual five – giving companies more time to start building.
(Fast-tracking of consents would become an important part of the Electrify NZ programme.)
Up to mid-2024, officials had, as directed by ministers, been working with the industry to draft policies. The pertinent ministers were Chris Bishop, RMA Reform, Energy Minister Simeon Brown, and Penny Simmonds, the then environment minister.
But, as mentioned in our previous piece, tensions led to the influential Electricity Sector Environment Group complaining to Minister Bishop about officials’ intransigence.
‘This data implies that there is not currently a significant environmental regulatory barrier to consenting new generation.’
Department of Conservation analysis, February 2024
As officials prepared for targeted consultation with others – the likes of council managers, the Planning Institute and environmental groups – consultation material was being prepared and circulated.
Into this maelstrom lands a paper from Te Waihanga/Infrastructure Commission and the Department of Conservation (DoC).
The Infrastructure Commission’s analysis shows consenting costs are rising as a proportion of project cost. Costs for smaller projects, like maintenance, are “disproportionately high”, at about 16 percent. Also, consenting delays mean the country “could be missing out on emission reductions”.
“Although these findings are generic for infrastructure they align with views from the renewable energy generation and electricity transmission sector.”
The paper also mentions an analysis done by DoC in February 2024.
As shown by the consultation meetings in part two of our series, the electricity industry dealt directly Business Ministry, which supports the energy sector, and the Environment Ministry, which oversees planning and environment policy.
DoC was involved because the Coastal Policy Statement is, unusually, approved by the conservation minister. Other national policy statements are the responsibility of the environment minister.
According to its founding legislation, one of the department’s purposes is to “advocate the conservation of natural and historic resources generally”.
Its advice on the Electrify NZ policy is strident and challenges the electricity industry’s claims.
Previous advice to ministers said the country’s Coastal Policy Statement (NZCPS) uses stronger, more directive language – in particular, the word “avoid” – which gave it primacy over national policy statements for renewable electricity generation (REG) and electricity transmission (ET). Therefore it was a perceived handbrake to power stations being approved.
The statement was central to two precedent-setting Supreme Court’ judgments: King Salmon in 2014, and Port Otago in 2023.
DoC’s analysis for Electrify NZ asked if the statement was a barrier to sufficient renewable power stations being built to meet electricity demand. It considered consents for land-based wind projects, solar and electricity transmission in four regions – Northland, Waikato, Taranaki and Southland.
“DoC’s research suggests that the NZCPS has not significantly constrained REG consenting,” the paper says.
Sixty-seven resource consent applications for wind and solar projects were identified, of which four, or 6 percent, were declined.
The department found 11 consent applications could potentially have been constrained by the coastal policy statement but all were granted, and no applications were rejected because of the statement’s policies.
(Consent decisions only tell part of the story. Under some council plans, electricity infrastructure projects are permitted under certain conditions, known as controlled status.)
Who Benefits is a project tracking and disclosing lobbying and influence. If you know where influence is being brought to bear, email us in confidence at: trublenzOIA@protonmail.com
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Part 1 A deep dive into proposed changes to freshwater policy
Part 2 Is a former farm lobbyist driving freshwater policy valuable expertise, democracy at work or a compromise to the public interest?
Environmental Defence Society
Part 1 examines a change of fortunes for one of the country’s most successful advocacy groups
Part 2 asks how a small team led for decades by one man has achieved outsized influence
Free Speech Union
Part 1 The rise and rise of the Free Speech Union
Part 2 A lobby group’s charm offensive and a doubting Thomas
Part 3 Seymour steps in and directs officials to consult
New Zealand’s gambling market
How monopoly money bought NZ’s gambling scene
Power Play: The influence of the electricity industry
Part 1 How energy-rich NZ became so expensive for electricity
Part 2 A new hope for renewable electricity
Part 3 The industry’s lobbying takes shape
Part 4 The officials strike back
The rejected consents were:
- Blueskin Bay (a community project just north of Dunedin involving one wind turbine): The Environment Court upheld the council’s decision “due to deliberate politicisation of the landscape, infringement on landscape values, and not being a proposal of significance.”
- Wind farm Te Waka Harapaki (Hawke’s Bay, stage 2): Declined “due to significant adverse impacts on an outstanding natural landscape, and the relationship of Māori to the land.”
- Lake Benmore Solar Farm (Mackenzie district): “Was declined because the site was classified as an outstanding natural landscape, and commissioners found the proposal would have potentially significant adverse effects on significant biodiversity values.”
- Brookside Solar Farm (Selwyn district): “Gave an inadequate notice period and reapplied for consent in August 2023”.
The department moves to a broader knockout blow, pointedly noting the “current and forward generation trends” of renewable electricity projects.
The Electricity Authority’s generation investment survey from January 2024 showed “the amount of new renewable electricity generation that has been committed has almost doubled in 18 months”.
(This somewhat confounds the earlier claim that uncertainty over the Tiwai Point aluminium smelter was a huge handbrake, and weakens the narrative of a consenting speed-up thanks to the fast-track legislation.)
Based on the projects’ proposed annual output, 5000 gigawatt hours (GWh) of new generation – mainly geothermal, solar or wind – had been committed to, the authority said. “This is up from 2600 GWh from the previous survey in July 2022.”
DoC’s analysis concludes: “This data implies that there is not currently a significant environmental regulatory barrier to consenting new generation. It does not mean that the regulatory settings will be fit for future purpose when significant additional generation capacity is required.”
(Consultation on the first National Conservation Policy Statement closed on August 10.)
During targeted consultation for the national policy statement, there’s pushback against the Government’s agenda from council planning officials.
According to notes from an August 2024 meeting, council staffers tell officials that consent delays are often caused by a “lack of prep” by applicants, such as not notifying affected parties in advance and “general unpreparedness”.
An unnamed Waikato Regional Council attendee writes, in response to planned changes to the RMA: “A number of the proposals we have seen already from the new Govt appear to be solutions looking for a problem.”
Meanwhile, an Auckland Council representative says: “I am not convinced there is a real issue.”
Mandating a one-year timeframe for consents to be completed will “significantly constrain mana whenua engagement”, says a staffer from Canterbury’s regional council, ECan.
An unidentified council staffer writes that proposed amendments to national policy statements start from the premise that consent authorities are generally inefficient, and take too long to process applications.
“Aside from a few, well-trodden, anecdotal examples, there is no actual quantitative evidence to support the problem statement…”
‘Careful what you wish for’
There’s also a warning about unintended consequences.
In the collective experience of council planning staff, delays to processing large infrastructure projects in general, and energy projects in particular, have been because of “poorly prepared applications”, incomplete information, and applicants requesting a pause so they can consult more thoroughly or widely.
“The Govt might therefore want to be careful what it wishes for here,” the council staffer writes.
“When these circumstances apply, but the consent authority is statutorily obliged to make their decision by a specified date, there is a real risk that consent authorities may be forced to decline projects that would, without such a deadline, be otherwise consentable.”
This is not the industry’s narrative, of course.
In the lead-up to targeted consultation, the Electricity Sector Environment Group, which had been corresponding with and meeting officials for months, bolsters its case by providing officials with case studies.
These mainly anonymous examples show how the planning system is holding back the industry’s projects, the group says.
- A wind farm, with up to 27 turbines, was proposed for a site with “large areas of productive pastoral land.” An initial ecological assessment found “pockets” of indigenous vegetation and wetlands, with frogs, bats and lizards in adjacent areas. The project was abandoned because of “likely extreme costs”, including for mitigation, offsetting and compensation.
- Several factors scuppered another potential wind farm, with up to 30 turbines, “including the pristine nature of the coastal environment, potential adverse landscape effects, and the value of preserving wilderness and remoteness”.
- A potential grid-scale solar development was “ultimately abandoned due to the presence of wetlands on-site”.
- A proposed battery energy storage system project was redesigned to avoid a natural inland wetland but, after a detailed assessment, the consent authority was convinced it fell outside wetland protocols. “… the whole episode was illustrative of the complexity of these rules, and the existential threat they pose to even the most benign … project.”
The case studies, submitted to officials in April 2024, include one named example – Genesis’s proposed Castle Hill wind farm, near Dannevirke. The project illustrates “the lack of national direction” to “protect” unimplemented resource consents, the document says.
Such uncertainties have “the potential to hinder investment decisions” and the rapid development of renewable energy infrastructure.
Genesis applied to extend its consent lapse period five months prior to its expiry. Consent processing – across two regions and four consent authorities – took more than eight months.
This “inefficient” process meant Genesis’ investment decision was “potentially jeopardised”.
The narrative blaming the planning system is a bit muddled, however. The case study document says the absence of transmission infrastructure for the Castle Hill wind farm “has resulted in a major barrier to implementing the project”.
Project delays can, therefore, depend on a variety of things.
Genesis still hasn’t built the wind farm, and it’s not listed on its website among future projects.
Genesis Energy chief operating officer Tracey Hickman says: “We continue to build an investment case for the site, progressing design activities and transmission connection options.”
Hickman says the consent is for a wind farm of up to 71 turbines, with a capacity of roughly 300 megawatts – big enough to power about 140,000 homes.
In 2013, when the wind farm was initially granted consent, it was deemed important enough for then Energy Minister Simon Bridges to put out a statement hailing “what could be the largest wind farm project in New Zealand”. At that time, Genesis’s plan was to build a wind farm with 286 turbines, generating up to 860 megawatts – enough to power about 370,000 homes.
Original intentions swerved
Back to the July 2024 paper from DoC and Te Waihanga/Infrastructure Commission.
It reveals some legislative changes suggested by the Electricity Sector Environment Group (ESEG) are “unlikely to go ahead”. One of the group’s top demands, to have renewable energy inserted into section 6 of the Resource Management Act, as a matter of national importance, has already been ruled out by ministers.
The “current understanding” of officials is the national policy statement could be amended to be more directive, “significantly” enabling more renewable electricity projects, without making the change.
The act, the paper notes, has “sustainable management” as a purpose. Which suggests, perhaps, a more directive regime was antithetical to that purpose.
As reported in our last piece, in a workshop with MfE officials in March 2024, Napier lawyer Martin Williams, representing the ESEG, was adamant the batch of national direction changes wouldn’t be enabling unless renewable electricity was elevated to section 6. Another ESEG letter said the move was “paramount”.
Perhaps officials disagreed, and persuaded ministers there could be unintended consequences. Of course, the decision could have been pragmatic since the Government is overhauling the RMA entirely.
The regulatory impact statement into changes to the NPS for Renewable Electricity Generation, penned by the Business and Environment Ministries and finalised in November last year, noted the “increased potential for adverse effects on the environment”, although the policies “aim to strike a balance” between those effects and the need for more renewable energy.
The statement also shows how the original intentions swerved.
“… early policy development that sought to direct decision-makers on the management of adverse effects in relation to matters of national importance areas and values addressed by other national policy statements … will now be addressed in the replacement resource management legislation.”
It was Cabinet that directed policy “relating to the management of adverse effects on significant environmental values” be kicked to the RMA replacement legislation.
The draft wording of the twin replacement bills – the Planning Bill and Natural Environment Bill – has been released publicly, and the environment select committee has now reported back.
Is the electricity industry close to achieving the level playing field for building power stations it’s been pushing for?
Greg Severinsen, the Environmental Defence Society’s reform director, says environmental limits have been fatally undermined by the committee’s recommendations. Writing in Newsroom, he says: “… any activity whatsoever is now allowed to breach a limit – whether farming, mining, factories, data centres, or something else – as long as the minister thinks its public benefits would outweigh the harm to the ecosystem or human health.”
Parliamentary Commissioner for the Environment Simon Upton says Parliament can have “no certainty” about the environmental outcomes of the bills because the balance is set by the minister of the day. In fact, the legislation gives “no particular priority to environmental outcomes”, he says.
Bishop, the RMA Reform Minister, said in a statement the new planning system will make it easier to do many things, including producing the renewable energy the country needs, “while continuing to protect the environment”. The economic benefits will be significant, he says, with independent analysis estimating a GDP boost of up to $3.1 billion a year until 2050.
But, Bishop told Newsroom after the select committee report that “we won’t have got it completely right – even now – but we’re working really hard to make that a reality”.
The spread of opinion about the replacement bills is obvious from a sample of the submissions.
The Environmental Defence Society said there’s nothing in the Natural Environment Bill that requires breaches of environment limits be avoided, and “the minister could also simply specify that avoidance of such effects is not practicable and that compensation is appropriate”.
Significant infrastructure will inevitably cause adverse effects, the Planning Institute/Te Kōkiringa Taumata said, and environmental limits may not always be met. “We support that the legislation provides this exemption pathway only in relation to ‘significant infrastructure’, and not more broadly to other activities.”
Te Tai Kaha, comprised of the New Zealand Māori Council, Federation of Māori Authorities, and Ngā Kaiarahi o te Mana o te Wai Māori, said the bills “lock in 35 years of resource over-allocation and degradation that have arisen under the Resource Management Act (RMA), and further prejudice Māori rights and interests in freshwater”.
Barry Weeber, chairperson of Environment and Conservation Organisations of Aotearoa-NZ, accused the Government of focusing on narrow, economic outcomes “with little consideration of environmental or social benefits and costs”.
“The large suite of consented wind farms that were not constructed is a commentary on the failures in the electricity market and the dominance of a small number of gentailers that have increased costs to the environment and consumers.”
Listed company Meridian, which is partly Government-owned, said development should be enabled within environmental limits, Meridian’s submission says – “provided the limits are realistic, focus on indigenous natural habitats, and are proportionate to the environmental values and risk involved”.
Electricity Networks Aotearoa, the collective for local and regional electricity distribution networks, said the bills don’t go far enough to protect existing infrastructure from “incompatible land uses” and, ideally, the planning framework should enable “further expansion and reinforcement of the network to accommodate the future needs of the community”.
A more positive submission comes from a familiar character in this series – the Electricity Sector Environment Group – which offers a neat bookend to this episode.
The group’s submission “strongly endorses and welcomes” the new legislation, which, it said, represents a “circuit breaking” intervention, including specific mention of doubling renewable electricity generation.
“This reform will finally put the systemic failures of the RMA behind us. The bills will deliver a more straightforward planning and environmental system focused on distinct goals for the built and natural environments, respectively.”
Positives of the new system, according to the group, include express goals for economic growth, infrastructure and urban environments “that have no counterpart in the RMA matters of national importance”.
Also, “mandatory, comprehensive national instruments” will provide “coherent policy direction”. There’ll be less regulation, the submissions said. New regulations will be “more effective and targeted”, focused on effects “that matter”, and engagement by “stakeholders” will be “more targeted and meaningful”.
(The Environmental Defence Society said the bills treated public participation as something to avoid.)
However, the Electricity Sector Environment Group said the bills didn’t go far enough to promote the “urgent” need to accelerate “essential” renewable electricity generation development. It suggested environmental guard rails should only be applied “to the most important and urgent matters” in which “there is a real risk of significant and irreversible harm to the natural environment”.
As it had throughout its lobbying campaign, the Electricity Sector Environment Group referred to the National Party’s policy on renewable electricity generation (REG), released in 2023, that it helped craft.
“This is critical to maintain the existing baseline of generation capacity and provide the essential platform for the intended doubling of REG capacity, committed to under Electrify NZ [original emphasis].”
As we know, critics fear the balance of the bills swings too much in favour of infrastructure building and economic development.
Leaving behind national policy statements and Electrify NZ, the final episode in our series explores ideas to overhaul the electricity system and loosen the grip of gentailers.
