New Zealand is committed to achieving net-zero emissions by 2050, with the Government targeting 100 percent renewable electricity generation by 2030. Beyond meeting these commitments, unlocking a low-emissions economy could provide much greater economic benefits for New Zealand.
The energy sector has a key role in decarbonising New Zealand’s economy and transportation to address the threat of climate change. For the country to enable a clean energy future and meet our climate goals by 2050, we will need to increase our current capacity to generate electricity significantly. By harnessing the country’s low-emission energy resources in conjunction with complementary technologies such as hydrogen, New Zealand could treble its annual electricity supply and grow renewable energy generation using wind, solar, hydro and geothermal resources beyond what is needed to meet the net-zero carbon emissions commitment.
However, this transition will bring additional challenges in areas such as price, reliability, and resilience. Robust transmission infrastructure is crucial to enable new generation connections across the country, especially in regions without the resources to support the grid and to improve reliability and resilience in an era of increasing demand and climate disruption. Other factors include ensuring a robust and efficient consenting process enables the development of renewable energy generation, which provides positive national benefits.
Clearly, respondents have a positive outlook for clean energy investments and delivery in New Zealand. There is a notably increased optimism in Lower North Island and South Island, likely a reflection of the government’s drive to decarbonise the industry together with offshore wind developers interested in building in these regions.
Wind and solar energy have become increasingly important in our electricity mix, but the growing share also poses challenges when the wind eases, and the sun is not shining. Energy storage options will therefore become more important to maintain reliability and capacity during periods of low wind and solar energy production. Pairing with new technology, existing infrastructure can be used more efficiently. This includes a number of technologies developed for the storage of energy and the management of demand, as well as distributed energy resources that are based closer to the sources of energy. The multi-billion-dollar pumped hydro scheme at Lake Onslow is one such storage option that will enable the country to switch entirely to cheaper renewable energy sources as it would be capable of storing at least 5 terawatt-hours of power, which equates to about an eighth of the country’s total annual electricity usage.
With the recent commitment from the government to provide a range of support to accelerate the transition to a low carbon economy through its Emissions Reduction Plan, energy companies are also more actively pursuing sustainability strategies and investments to support decarbonisation and the transformation of the energy system. There are, however, consenting and RMA challenges to overcome.
