Buzz from the Beehive
Point of Order looked again on the government’s official website for statements from Energy and Resources Minister Megan Woods about two energy-related bills that were rushed into law last week.
We can’t say she has been silent, because she had lots to say in parliament about the need for urgency in enacting these bills.
But she has yet to post press statements on the government’s official website to explain what she has been doing, apparently putting the onus on the public to wade through Hansard’s record of parliamentary proceedings to find out what she is up to.
She was not so shy when it came to braying about five solar projects – in Whangārei, Tauranga, Palmerston North and Christchurch – being the first to receive funding from the government’s Community Renewable Energy Fund.
Budget 2023 last week topped up the funding by another $30 million – on top of $16m in Budget 2022 – for the next four years to ensure even more households and communities can benefit from renewable energy and make their power bills cheaper.
Around $1.2 million will be allocated across the five projects. The process to allocate the remaining funding is still being finalised, and will be announced later this year.
Community Renewable Energy Fund – first tranche of projects
Soho Group Limited, ‘Project 3 Wanaka-Tebbs’, $400,000
Solar PV panels will be installed on 35 public rental homes that are being constructed in new housing developments in Tauranga and Whangārei.
Manawa Household Limited, ‘Manawa Kaumātua Village’, $220,000
Solar PV panels will be installed on 20 kaumātua rental flats that are being constructed in Tauranga.
Habitat for Humanity, ‘Project Maunu Road’, $225,409
Solar PV panels will be installed on 23 homes of a new community housing development being constructed in Whangārei.
Camellia House Trust, ‘Sustainability Haerenga’, $35,000
A solar PV system with battery will be installed for the transitional housing facility in Manawatū that provides accommodation for vulnerable people, including children.
He Waka Tapu Limited, ‘Ahikā Housing Project’, $239,635
A centralised microgrid solar PV system with an automated billing system and battery will be installed to support 10 residential units at a new facility in Christchurch that will be built to provide emergency and transitional accommodation to whānau.
The news of this largesse being provided for a few favoured groups can be found on the Beehive website.
Three other fresh statements draw attention to government spending initiatives. Megan Woods was one of three ministers in whose name one of these statements – dealing with corporate welfare to benefit New Zealand Steel, according to the critics – was released.
- New Zealand will provide NZ$15 million in emergency budget support for Cook Islands in its ongoing recovery from the impacts of COVID-19. The funding is being drawn from existing MFAT international assistance and will assist the Cook Islands Government in continuing to deliver essential services.
- At a celebration at Te Wharekura o Kirikiriroa, Associate Minister for Arts, Culture and Heritage Willow-Jean Prime spoke in a blend of English and te reo to say a government’s investment of $34 million in kapa haka over two years would ensure
“… that this kaupapa is funded in an equitable way, embedding a rohe-based Kapa Haka network and assisting across the motu to plan for the future and achieve the vision of Te Matatini – Mana motuhake ki te kāinga. Matatū, Mataora, Matatini ki te ao.
- The Government is partnering with New Zealand Steel to deliver New Zealand’s largest emissions reduction project to date, with half of the coal being used at Glenbrook steel to be replaced with electricity to recycle scrap steel. The conditional deal with NZ Steel will be part-funded up to $140 million from the $650 million Government Investment in Decarbonising Industry (GIDI) Fund, which enables partnerships with industry to reduce their emissions. The rest will be funded directly by NZ Steel.
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Perhaps Woods was kept so busy with the New Zealand Steel and community energy statements that she has yet to get around to the two bills that were raced trhough Parliament in a matter of hours last week.
RNZ – more helpfully than the Minister – reported on the new legislation in its from The House at 6:55 pm on Friday.
It’s the norm following the delivery of the Budget for the House to go into urgency, a chance for the government to move through legislation directly related to the Budget and some other stuff too.
This means a longer than usual week at parliament – that’s why MPs have been sitting today on a Friday. But mercifully for them, or us, this week’s legislative load under urgency following the 2023 Budget has been quite light.
As Point of Order reported earlier that day, five bills were attended to.
Two of these – which passed through all parliamentary stages in just a few hours – relate to the supply of energy.
The Energy Resources Levy Amendment Bill aims to ensure the Crown receives a fair financial return for its fossil gas. According to the Government, it must be passed quickly so as to avoid confusion over the current interpretation of the law and losses of levy revenue to the Crown and the public.
Urgency is being used to ensure that levy funding is available to maintain “fuel resilience” for the country, in the form of the Energy (Fuels, Levies, and References) Amendment Bill, as funding certainty is required to finalise the arrangements for the reserve diesel stock arrangement by the end of 2023.
Moving that the Energy Resources Levy Amendment Bill be read a first time, Woods provided some history:
Licences granted under the old Petroleum Act 1937, resulting from a discovery before 1 January 1986, were subject to a royalty rate of either 5 or 10 percent. In comparison, post-1986 licences and modern permits granted under the Crown Minerals Act 1991 pay either 12.5 or 20 percent royalty rates.
To ensure the Crown received a fair financial return from the pre-1986 licences with low royalty rates, the Energy Resources Levy Act 1976 imposed a levy on gas production. Discoveries made before 1 January 1986 were exempt from paying this levy.
But the use of the word “discovery” in the exemption clause potentially could lead to some confusion about whether fossil gas production from newly producing deposits within pre-1986 licence areas could be considered new gas discoveries for the purposes of the exemption, Woods said. This could undermine the broader intent of the petroleum legislation to achieve a fair financial return to the Crown.
The Government recognises this is a problem and one that needs to be fixed. If this is ignored, the Crown could lose millions in revenue. I see this as a significant amount of money that the Crown is entitled to collect for the benefit of the New Zealand public. The bill will clarify that the levy exemption does not apply to gas produced from any land to which a licence relates if the licence was granted in relation to a discovery of gas that was made before 1 January 1986. This would clarify that the pre-1986 licence holders who operate on a low royalty rate must pay the top-up levy. The amendment will only apply prospectively, so it will not impact on previous payments or non-payments. This is fair, and this is reasonable.
When Woods moved that the Energy (Fuels, Levies, and References) Amendment Bill be read a first time, she said it proposes an amendment to the Energy (Fuels, Levies, and References) Act so that the petroleum or engine fuel monitoring levy can be used to cover the costs of strengthening New Zealand’s onshore fuel resilience in addition to its existing purposes.
She wanted the bill taken through all stages under urgency to enable a smooth roll-out of the Fuel Resilience Policy Package and better strengthen New Zealand’s fuel resilience and economic security.