Proposed freshwater controls viewed as unfair for smaller schemes

AUCKLAND: Exempting the country’s major hydro catchments from new controls on freshwater quality appears arbitrary and runs the risk of putting disproportionate scrutiny on smaller schemes, Trustpower chief executive Vince Hawksworth says.

The proposal — to allow councils to accept lower water quality in rivers hosting major dams — is intended to maintain flexibility for the country’s biggest providers of renewable energy.

But officials acknowledged the move is a compromise that could be unfair to producers of about 10% of the country’s hydrogeneration.

Mr Hawksworth said everyone had a part to play to improve water quality and most also share an ambition to make greater use of renewable energy to counter climate change.

But he said the Government’s ‘‘somewhat crude’’ initiative missed an opportunity to align those desires with the way policymakers and communities think about the generation assets that use the country’s ‘‘very valuable’’ water resource.

‘‘It does send a bit of a message that not all renewables are equal, which in our view is a little bit concerning,’’ he told BusinessDesk.

The new water management regime proposed by the Government last week will require regional councils to have new freshwater plans in place no later than 2025.

Interim controls will be imposed in atrisk catchments and options on water allocation will be developed through 2020.

The papers, open for discussion until October 17, acknowledge the importance of hydro generation to meeting the Government’s renewable energy targets but also the fact that dams have altered natural flows and tend to reduce the flood flows that clean river beds and clear sediment.

The Government’s proposal would give councils the option to set water standards below national minimums in the biggest hydroelectric catchments — the Waitaki and Manapouri schemes operated by Meridian Energy, the Tekapo, Tongariro and Waikaremoana schemes operated by Genesis Energy, Contact Energy’s Clutha scheme, and the Waikato hydro system operated by Mercury NZ.

Officials admitted that limiting the exemption to major hydro schemes was a ‘‘pragmatic’’ option, given the preference among Kahui Wai Maori — the Maori freshwater forum — for exceptions to be kept to a minimum and the need to maintain ‘‘stakeholder confidence’’ in the new freshwater policy.

Making the exemption available for all hydro schemes would have treated all generators fairly and avoided ‘‘marketdistorting’’ effects, officials said. But it would have probably had little impact on councils or operators as smaller hydrogeneration is usually ‘‘runofriver’’ with little storage, so tends to do less harm to water quality.

Members of the Independent Electricity Generators’ Association operate about 200MG of capacity around the country, most of it renewable and most of it hydro.

IEGA secretary Mary Ann Mitchell said the cost of Resource Management Act processes were already disproportionately high for IEGA members, given most are relatively small. The Government’s proposal would compound that.

‘‘It creates quite an uneven playing field for the different generators that are all competing in the same market,’’ she told BusinessDesk. — BusinessDesk