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New Zealand

Official Name:
New Zealand

National Designated Entity

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Energy profile

New Zealand (2012)

Energy profile
Energy profile
Extent of network

It is estimated that New Zealand’s electrification rate was 87% up to 2006. The national transmission grid consists of 11,803 km of high-voltage lines. The majority of the network on both the North and the South Islands operates at 220 kV, with 110, 66 and 50 kV transmission lines connecting provincial towns and cities, and smaller power stations. The High-Voltage Direct Current (HVDC) Inter-Island system connects the grids of the North and South islands, via a 40 km undersea cable in the Cook Strait.

Renewable energy potential

Solar energyAverage insolation across both islands is approximately 4 kWh/m2/day. Both solar hot water and photovoltaic technologies have been explored in the country as potential resources, with 40 GWh/year of solar water heaters installed by 2001 in the country. Potential sites for solar energy include Auckland, Christchurch and Invercargill. Due to the nature of the resource, solar thermal is identified as being a more viable option for exploration for the country. As of 2006, 35,000 solar hot water systems had been installed in various domestic and public buildings in the country.Wind energyWind generation currently provided roughly 4% of New Zealand's electricity needs, with 407 GWh of electricity being generated by wind installations in June 2010. In recent years the introduction of wind power has gained momentum. New Zealand is ideally suited for wind generation with its long coastlines, where sea breezes and the lack of natural impediments result in consistent and relatively strong winds throughout the year. The Energy Efficiency and Conservation Authority ("EECA") has produced a publication; Review of New Zealand Wind Potential to 2015, which identified 13 general areas where wind developments would be suitable. Total potential capacity for wind power installations in the country is estimated at 14,490 MW, with average wind speeds of 7.5-8 m/s observed in many locations.HydropowerThe last major resource assessment of New Zealand's hydro-electric potential was conducted in the 1990. The assessment identified over 200 schemes, with a potential of over 12,000 MW. Current developments include the addition of 46 MW to the Arnold Power Station in the West of the country, resource entitlements for which were granted in 2008. However, developments in the hydropower sector are expected to be limited, due to the environmental impacts of large hydropower projects on local flora and fauna, as well as on the rural population.Biomass energyConventional biomass energy, biofuels (in particular the derivation of aviation fuel from jatropha oil) and bioethanol production all hold potential in New Zealand, a country which sources 40% of its industrial energy requirement from biomass already. Legislation passed in 2008 stipulated the need for petrol and diesel products to be blended with at least 2.5% biofuel by 2013.Geothermal energyThe first geothermal plant in New Zealand was opened at Wairakei in 1958 as the second large-scale geothermal plant completed in the world, after Larderello, Italy. Geothermal energy now makes up approximately 10% of the country's electricity and has an installed capacity of nearly 0.8 GW at the beginning of 2011. High-temperature geothermal fields are mostly concentrated around the Taupo Volcanic Zone in the central North Island.  An additional 583 MW of geothermal capacity is expected to be installed by 2012.

Energy framework

The Energy Efficiency and Conservation Act 2000 is the legislative basis for promoting energy efficiency, energy conservation and renewable energy in New Zealand. As a requirement of the Act, the Minister responsible for energy established a strategy for energy efficiency and conservation. This strategy must be reviewed, and updated as necessary, on a regular basis. In addition, the Act established the Energy Efficiency and Conservation Authority (EECA) as a stand-alone Crown entity, with a role to promote energy efficiency, energy conservation and renewable energy across all sectors of the economy. It empowers the preparation of regulations implementing product energy efficiency standards and labelling, as well as disclosure of information to compile statistics on energy efficiency, energy conservation and renewable energy.The Electricity Industry Reform Act 1998 was the major piece of legislation used to achieve energy sector reforms. The Act effectively separated electricity lines from generation and retail where those activities were co-located, promoted competition in electricity generation and retail, and limited the barriers to new investment in generation from renewable energy sources. Amendments to restrictions on ownership of electricity generation by line companies were made in 2001 and 2004, followed in 2008 by further policy changes. These changes eased restrictions on the sale of generation output, narrowed the scope of ownership separation requirements, and amended the definition of renewables from ‘new renewables’ to include traditional hydropower and geothermal electricity generation. The Act was revoked and its provisions have been incorporated into the Electricity Industry Act 2010.The New Zealand Energy Strategy (NZES) 2011-2021 was announced by the Minister of Energy and Resources on 30 August 2011. The NZES sets the strategic direction for the energy sector and the role energy will play in the New Zealand economy. The government’s goal is for New Zealand to make the most of its abundant energy potential through the environmentally responsible development and efficient use of the country’s diverse energy resources. The four priority areas of the NZES are: diverse resource development; environmental responsibility; efficient use of energy; and secure and affordable energy. The NZES includes targets to generate 90% of electricity from renewable sources by 2025 and to achieve a 50% reduction in the GHG emissions from 1990 levels, assisted by the New Zealand Emissions Trading Scheme to drive investment into technologies that produce fewer emissions.  A companion strategy, the New Zealand Energy Efficiency and Conservation Strategy (NZEECS) 2011-2016, was also announced on the same day. The NZEECS is prepared in accordance with the Energy Efficiency and Conservation Act 2000 and outlines Government policies, objectives, and targets, and as required by the Act, will be in force for a period of five years. The NZEECS has a specific focus on  the promotion of energy efficiency, energy conservation and renewable energy. The NZEECS sets out six objectives for six sectors, which will contribute to the overall New Zealand Energy Strategy 2011-2021 goal:Transport: A more energy efficient transport system, with a greater diversity of fuels and alternative energy technologies.Business: Enhanced business growth and competitiveness from energy intensity improvements.Homes: Warm, dry and energy efficient homes with improved air quality to avoid ill-health and lost productivity.Products: Greater business and consumer uptake of energy efficient products.Electricity System: An efficient, renewable electricity system supporting New Zealand’s global competitiveness.Public Sector: Greater value for money from the public sector through increased energy efficiency.It keeps the government target to achieve a rate of energy intensity improvement of 1.3% per annum.The Government joined the International Renewable Energy Agency, effective 1 May 2011, to ensure to its works to remain alongside the top performing countries.  New Zealand ratified the UN Framework Convention on Climate Change (UNFCCC) as an Annex I party on 16 September 1993, and the Kyoto Protocol on 19 December 2002. To assist in meeting the country’s Kyoto targets, the government introduced a New Zealand Emissions Trading Scheme (NZ ETS), which commenced in July 2008.In February 2010, New Zealand announced that it was joining the Copenhagen Accord on climate change.The government has set two national targets for reducing greenhouse gas emissions: a medium-term responsibility target of a 10% to 20% reduction in emissions below 1990 levels by 2020 and a long-term target of a 50% reduction in net greenhouse gases from 1990 levels by 2050.

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