How quickly our gas supplies are dropping is what’s really alarming some energy analysts. Cutting our options for reliable power
So, the lights didn’t go out on Friday morning. We got close but we avoided the worst, mostly by pulling together and turning off whatever we weren’t using.
Now, if you read this column, you’ll know I don’t spend a lot of time talking about the last Labour Government nowadays.
I should spend much more time talking about them because many of their stupid decisions will continue to affect us negatively for decades if not generations.
But talking about Ardern’s Labour makes me feel variously bored or angry and neither are emotions I enjoy.
This time, though, we really do need to talk about the Sixth Labour Government because they deserve for us all to be reminded of the unforgivable stupidity and naivety of their decision to ban offshore oil and gas exploration in 2018.
Let’s start by clearing one thing up. The near-power shortage on Friday was not caused by the last Labour Government’s oil and gas ban.
It was caused by a combination of not enough wind, two gas plants being offline, Huntly’s number 1 unit being offline, an unexpectedly cold morning for this early in the year, and a gas shortage.
That gas shortage is also not their fault. Yet. But it’s a big deal. The country is running out of gas faster than expected. Right now, we have a little more than half what we thought we would have two years ago. According to energy analyst John Kidd, we were expecting to be producing 210 petajoules. We are producing around 110 petajoules.
The country normally uses 200 petajoules. This means we are producing about half what we can use. That’s why Huntly has been burning so fiercely for so many weeks now. We’re using coal to plug the gap gas has left.
How quickly our gas supplies are dropping is what’s really alarming some energy analysts.
This, also, is not the last Labour Government’s fault. Gas fields eventually just run out. But, what happens next is the fault of the last Government.
Even if we started the process of drilling for new oil right now, it’ll take us years to get it into the electricity system. That means we have potentially multiple winters of potential power cuts on cold mornings.
That’s because of the oil and gas ban. After that kicked in multiple permits were handed back and investment into new drilling stopped. We lost years of looking for and drilling for gas to replace what we’re losing now.
We’re not even sure investors will try again. Why would they, with the threat that the next Labour government bans them all over again?
Until investors are brave enough to have another crack, we have two options left to us.
The first is to import as much nasty Indonesian coal as Huntly can burn. Genesis will start importing again this year. It hasn’t done it since 2022 but it’s burning through its stockpile faster than expected because of the gas shortage.
That’s one of the most criminal parts of what the last Labour Government did. Banning gas didn’t help the climate. It will speed up climate change.
Burning coal is much worse. The second option we have is to cut how much electricity we use. Which means you and I not charging our phones on cold mornings. It also means big gas users like Methanex cutting input into the Waitara plant, therefore lowering production, which means lowering exports, which means making NZ poorer.
The only good that oil and gas ban did was to make Labour and their most naive supporters feel good. Other than that, they made NZ poorer and colder and hurt the planet.
Their decision was cynical and stupid. They deserve us to remember this for a very long time.