Questions, no Government answers on KiwiSaver fossil fuels ban

The ban on default Kiwisaver accounts investing in fossil fuels that was announced yesterday remains vague, with the Government making unsupported claims and saying they will provide details later.

So it looks more like yesterday was more campaign PR exercise than solid plan.

I wonder if the Green Party are hoping that the details can wait until after this year’s election – and hoping they don’t have to worry about being vetoed by NZ First. Notably their were three Ministers involved in the announcement, Kris Faafoi and Grant Robertson (both Labour) and James Shaw (Greens). The elephant wasn’t in that room, but is trying to get re-elected in a pivotal role.

Newsroom asks more than Three questions about the KiwiSaver fossil fuels ban

The reason the Government is making its announcement now is the terms of the nine existing default providers expire in June 2021, and the newly-announced rules will apply to anyone wanting to run a default fund after that.

So the actual rules may not be clear until next year.

A vague claim in the Beehive promotion of the policy seems misleading: “In 2017, the $47 billion NZ Superannuation Fund adopted a climate change investment strategy that resulted in it removing more than $3 billion worth of stocks that exceed thresholds for either emissions intensity or fossil fuel reserves, without negatively affecting performance. So we know that moving away from investments in fossil fuels doesn’t have to mean lower returns.”


Perhaps the highest-profile model – and the one quoted in the Government’s release – is the NZ Super Fund. But that fund, while putting considerable store on its Climate Change Investment Strategy and its carbon exclusion methodology, is proudly not fossil fuel-free.

…what the announcement doesn’t mention is the Super Fund has kept the top performing emitters in its portfolio. “Stocks in the top quartile of the “Carbon Emissions” score – reflecting less risk due to better management than their peers with respect to climate issues – have been retained in the portfolio,” Super Fund spokesman Conor Roberts says.

So this sounds like prudent investing – getting out of risky fossil fuel companies but keeping investments in “top performing emitters”.

Question 1: How do you define investment in fossil fuels production? Which companies fall into the category of banned investments?

Some are pretty straightforward. Oil companies Shell, BP and Exxon Mobil are presumably out. But what about NZ petrol distributor and retailer Z Energy?

What about ANZ, BNZ or Westpac, with their huge loans to Australian mining companies? As one commentator put it to Newsroom: “A decent whack of KiwiSaver funds are going to Australia and if you are investing in Australian banks you are knee deep in fossil fuels.”

Then there are the huge international funds. Warren Buffett’s mega-fund management company Berkshire Hathaway has an energy division that owns a number of coal-fired power stations

What about companies that are huge users of (and therefore encouragers of) fossil fuels production? Toyota or Volkswagen, the world’s largest producers of fossil fuel-driven cars; Fonterra, whose coal-fired milk processing plants make it one of the country’s top CO2 emitters; Air NZ, whose search for alternative fuel sources hasn’t come to much so far.

That’s a question I have already asked. It’s an important one that hasn’t come close to being answered yet.

There’s no definition of “fossil fuel production” in the Government’s press release. There’s also no information on whether the Government is going to give default KiwiSaver providers guidance on what exactly it means by “excluding investment in fossil fuels”.

When Newsroom asked  Kris Faafoi’s office for clarification, spokesman Peter Stevens told us only: “The Government will provide more detail on the threshold and definition of the exclusion before calling for tenders, as part of the process to appoint new KiwiSaver default providers.”

That sounds like next year, after the election.

As one KiwiSaver provider, who didn’t want to be named, told Newsroom. “Is the Government deliberately leaving it open, or are they going to come back later and tell providers they actually had a more specific idea how this is going to be interpreted?”

It’s not even clear whether it will be defined by the Government.

Question 2: What evidence does the Government have that its fossil fuels-free strategy won’t harm the financial performance of New Zealanders’ retirement savings?

Faafoi: ““It also makes sense for the funds themselves given that there is a risk of investing in stranded assets as the world moves to reduce emissions.”

And: “So we know moving away from investments in fossil fuels doesn’t have to mean lower returns.”

Which is only vaguely reassuring, particularly given the fact the Super Fund made a calculated decision not to get out of fossil fuels entirely – see above.

The Government appears to be assuming that it knows better than KiwiSaver fund managers what investment strategy is right for their fund in terms of risks and returns.

Which coincides with their climate change mitigation ideals.

“I’m not convinced government should be the arbiter on where the best returns can be generated in a portfolio,” one KiwiSaver manager told Newsroom. “If the objective of KiwiSaver is to make as much return for investors as possible, then fund manager should have freedom where they invest.”

But what would they know about investing, especially compared to politicians who have experience in investing in their own interests.

Question 3: Isn’t shareholder activism one way to produce positive change? But that means you have to be a shareholder.

…these days there’s another argument increasingly being heard in the investment community.

Why investing in coal mines could (maybe) be ‘responsible investment’.

Berridge argued that investors, particularly large ones, should be engaging actively and openly with companies whose products, activities or business models they are concerned about.

“If you are an investor in a ‘bad’ company and you vote for change, you have a chance to make a difference,” Berridge told me. “But if you invest just in ‘good’ companies, there is an argument your vote makes no difference.

“For an individual looking at a KiwiSaver fund, for example, there is an argument that choosing a provider or a fund which feels good is not helping things. It’s the weakest method of trying to make a difference.”

The move by the New Zealand Government to ban investments in fossil fuel companies risks being counterproductive, another KiwiSaver manager told Newsroom.

“There is a real danger we are shooting ourselves in the foot here. If our voices aren’t heard at the board table there’s a risk that progress towards emissions reduction goals could be slower.”

Maybe the Government is planning on forcing companies to change so shareholders won’t have to. Again that’s  questionable interference by the Government.

Waters are muddied still further by the fact that some companies that are heavy producers or users of fossil fuels are also putting a lot of money into trying to move towards renewable energy. Majority Finnish government-owned oil company Neste is also one of the largest producers of renewable diesel in the world.

Companies heavily involved in fossil fuels have plenty of incentive to diversify into clean energy alternatives to position themselves well for the future. If they lose investors they may be less able to do that.

With the lack of details yesterday’s announcement was more of a Labour-Green PR exercise than a definitive plan. They will probably use it in their campaigning this year. We re unlikely to know what their new investment rules will actually mean for people who invest via Kiwisaver.



New Kiwisaver rules will ban ‘investing in fossil fuels’

The Government plans to impose new rules on Kiwisaver.

One makes sense – changing default Kiwisaver schemes from conservative to balanced. Most people starting on Kiwisaver will have a long time until retirement, and should be at least in balanced funds if not in growth funds until they get closer to retirement (except perhaps for now when the share market is tanking). People are still free to choose what scheme they are on.

One seems a waste of time – banning Kiwisaver investments in “companies making land mines, cluster bombs, and other illegal weapons”. I hope that will affect just about no Kiwisaver schemes, although it can get complicated where large companies do many things, and have a lot more suppliers and contractors.

One may be more controversial – banning Kiwisaver investments in ‘fossil fuels’.

RNZ: New KiwiSaver rules to ban investing in fossil fuels and illegal weapons

Commerce Minister Kris Faafoi said banning investment in fossil fuel companies would help combat climate change and carbon emissions.

“It also makes sense for the funds themselves given that there is a risk of investing in stranded assets as the world moves to reduce emissions.”

He said the Superannuation Fund quit such investments more than two years ago and its investment returns had not suffered.

‘Not suffered’ on it’s own is meaningless.

It may be interesting to see what the rules actually define for ‘fossil fuel companies’. Exploration and drilling and mining should be clear, but what about distribution and sales? Airlines, shipping and transport companies that use a lot of fuel? Car manufacturers?

UPDATE – the Beehive has released clarification and more details. The ban on investing in fossil fuels only applies to default funds, so it’s more gesture than a comprehensive government interference in what you can invest your own money in.

Default KiwiSaver changes support more responsible investment

New Zealanders’ savings in KiwiSaver default funds will soon exclude investment in fossil fuels, the Ministers of Finance and Commerce and Consumer Affairs announced today.

Rule changes mean that investments in fossil fuel production will be excluded from future funds that are default providers.

Default providers are funds that are allocated to people who do not actively choose a fund when they join KiwiSaver.

“This reflects the Government’s commitment to addressing the impacts of climate change and transitioning to a low-emissions economy,” Commerce and Consumer Affairs Minister Kris Faafoi said.

“It also makes sense for the funds themselves given that there is a risk of investing in stranded assets as the world moves to reduce emissions.

“In 2017, the $47 billion NZ Superannuation Fund adopted a climate change investment strategy that resulted in it removing more than $3 billion worth of stocks that exceed thresholds for either emissions intensity or fossil fuel reserves, without negatively affecting performance. So we know that moving away from investments in fossil fuels doesn’t have to mean lower returns.”

Climate Change Minister James Shaw said rules set down by previous governments have allowed New Zealanders’ hard-earned money to be used to support the fossil fuels companies that are the leading cause of the climate crisis.

“No New Zealander should have to worry about whether their retirement savings are causing the climate crisis. That’s why our Government is moving default KiwiSaver funds away from fossil fuels, putting people and the planet first,” James Shaw said.

Finance Minister Grant Robertson said the Government wanted to ensure people who remained in default funds got the maximum benefit from their investments.

The terms of the existing nine default providers expire in June 2021.

“As we go about appointing new providers, the Government is also improving the settings for investors,” Grant Robertson said.

“We’re changing default fund settings from ‘conservative’ to a ‘balanced’ fund. The change is intended to make a real difference to people’s financial wellbeing in retirement,” Mr Robertson said.

“We’re also focusing on ensuring New Zealanders get greater value for money from their fees, which we know can make a big difference in the amount of money people have for their retirement. So the fees each provider charges will be factored into the providers we select during the procurement process,” Mr Robertson said.

Kris Faafoi said another key area of focus would be to ensure members have all the information they need to make good decisions about their fund.

“We want all New Zealanders to enjoy the benefits of KiwiSaver. No fund will be right for everyone so we’re requiring default providers to do more to engage with their members and help them make the right decision for their circumstances. This will help with things like understanding what fund is best for KiwiSaver members and how much they should be contributing so they are on track for the type of retirement they want”, Mr Faafoi said.

About 690,000 New Zealanders have stayed in default KiwiSaver funds, which they were automatically enrolled in when they started a new job. Approximately 400,000 of those have not made an active choice to stay there.


Improvements the Government is making include:

  • changing the investment mandate from ‘conservative’ to a ‘balanced’ fund
  • ensuring KiwiSaver fees are simple and transparent, and using the procurement process to put pressure on fees
  • obligations on default providers to engage with their members to help them make informed decisions about their retirement savings
  • excluding investments in fossil fuels and illegal weapons. While default fund providers have in recent years divested any investments in companies involved in illegal weapons like cluster munitions and anti-personnel landmines, the changes now enshrine that requirement in default fund settings
  • requiring default providers to maintain a responsible investment policy that’s published on their website
  • transferring non-active default members[1] of any provider that is not reappointed to one of the appointed default providers[2] (so that these members retain the benefits of being in a default fund).

KiwiSaver default fund providers

When people enrol in KiwiSaver but don’t actively choose an investment fund, the Government allocates them a default fund. Around 690,000 people remain in a default fund, and approximately 400,000 of those have not made an active choice to stay there.The terms and conditions that apply to a default provider’s appointment are contained in an instrument of appointment, which is agreed to prior to the term of appointment. There are currently nine default fund providers, and their terms expire in mid-2021.

Every seven years, the Government reviews the settings for default providers ahead of appointing a new selection of default providers through a competitive tender process. The new settings will apply to the default funds that are in place from mid-2021. The procurement process to appoint the new default KiwiSaver providers commences later this year.

Greens pushing to end oil and gas exploration

Gareth Hughes has had a low profile as a Green MP for some time, but he is upping his efforts to end oil and gas exploration.

Newsroom:  Greens want Labour to toughen gas ban

A supplementary order paper from Green MP Gareth Hughes threatens to rip the scab off the Government’s contentious ban on new offshore oil and gas exploration.

The Government announced an end to the issuing of exploration permits for offshore oil and gas exploration in April.

The ban did not affect existing permit holders, who were free to continue extracting oil and gas.

But as backlash mounted against the ban, the Government granted a significant concession to exploration companies.

Hughes has used a supplementary order paper (SOP) to try to overturn Woods’ decision. An SOP allows MPs to amend legislation that is currently before the House.

But the proposal has come at an awkward time for the Government.

A perfect storm of catastrophes has exposed just how reliant New Zealand is on gas. Unseasonably cold weather and low water levels at the South Island’s hydro-lakes has meant electricity generators have had to use gas and coal.

Unfortunately, two outages at the Pohokura gas field and essential maintenance on the Maui pipeline has meant New Zealand’s gas resources haven’t been ready to pick up the slack left by depleted hydro-lakes.

This has sent wholesale electricity prices soaring .The average wholesale price for most of October was $300 per MWh. Last October the average was just $102 per MWh.

I use Flick for power. They are usually quite reasonable, but my last two power bills have jumped up, with one over double the previous week ($100 for a week).

Hughes says the loophole means offshore drilling could continue indefinitely, defeating the purpose of the ban. He has called on Labour and New Zealand First to back him.

“The whole point of ending future offshore permits was to ensure a smooth transition away from fossil fuels. To extend existing permits defeats the purpose,” he said.

But due to us being far from reducing our dependence on fossil fuels a reduction in gas recovery risks forcing us to use less clean energy, and forcing us to import more fossil fuels.


Levy on traditional vehicles may fund ‘freebate’ for electric vehicles

The Productivity Commission has put out a draft discussion document calling for drastic measures to shift from fossil fuels to clean electricity. One proposal, being promoted by climate change minister James Shaw, is to put a surcharge on new vehicles that rely on fossil fuels and use that to provide a ‘freebate’ to lower the price of electric vehicles.

RNZ: Fuel-car levy could subsidise electric vehicles – govt

In a draft discussion document, the Productivity Commission estimated carbon prices may need to be 12 times higher, up to $250 a tonne, to reach the government’s goal of net zero emissions by 2050.

That is a huge change in what is supposed to be a market.

It called for a shift from fossil-fuels to clean electricity and greater use of farmland for forestry and horticulture.

Green Party co-leader and Climate Change Minister James Shaw told Morning Report one option being looked at was the prohibitive cost of electric vehicles.

“So what the report is talking about is a freebate system where essentially we charge a price on – we put a levy on – fossil fuel vehicles and you use that revenue to subsidise electric vehicles.”

“What we all know right is that electric vehicles are a lot cheaper to run because they’re roughly about a third of the price per kilometre versus petrol, they’re a lot cheaper to maintain because they’ve got fewer moving parts, but the up-front cost of the vehicle is prohibitive.”

“If we continue to allow greenhouse gas emissions to increase, and we don’t invest in new technologies, and we don’t switch our car fleet and we don’t change how we do electricity, then yes they’re suggesting that there will be a bit of a shock to the economy.”

He said he did not know when such a change might be brought in, and it was just one of many options they were considering.

National is critical:

National’s transport spokesperson Jami-Lee Ross said the government should follow their lead and continue prioritising electric vehicles for the crown fleet.

Mr Ross said a levy would hit people at the lower end of the socio-economic spectrum hard.

He said people who can only afford cheap secondhand Japanese imports would effectively be subsidising the cost of electric cars for the wealthier New Zealanders who can afford them.

That same argument applies in part to subsidies for home insulation and for installations of solar panels.

For vehicles this could be resolved by putting a big enough levy on fossil fuel driven vehicles to enable a full ‘freebate’ – giving electric vehicles to poor people for free. That would be popular, especially in the winter for those who are given a free handout to help pay power bills.

Labour-Green oil and gas naivety questioned

The Government announcement last that no more off shore oil and gas exploration permits would be granted was celebrated by the Greens and their allies (like Greenpeace), but it hasn’t received wide support. Questions are being asked of the possible negative effects, and the lack of planning or substance on the transition from fossil fuels to alternative forms of energy.

Listener: Is the Govt’s ban on new oil and gas exploration brave or naive?

Just transition or heart over head?

The decision to stop issuing offshore oil and gas exploration permits was not pre-election policy. Although Prime Minister Jacinda Ardern was musing privately months ago about the politics of such a move, it is barely a month since she broke from her formal programme to accept a petition from Greenpeace on the forecourt of Parliament.

Always with an eye to powerful imagery, Greenpeace backed the moment with pictures of history-changing Labour leaders of the past: Savage, Kirk, Lange and Clark. Ardern could enter that pantheon with a huge symbolic gesture designed to make real her claim that climate change is “this generation’s nuclear-free moment”.

She has done so, in a move that is at once measured and justifiable yet also naive and arguably cavalier with a major industry. No other country with a significant oil and gas industry has made such a decision.

…the naivety of the Government’s new policy is that it will not, of itself, reduce global carbon emissions, but could increase New Zealand’s if it leads to more coal use in the meantime.

It is disingenuous to claim that existing permits might sustain a healthy oil and gas sector until the 2040s. The fruitless hunt for major gas fields in the Great South Basin since the 1960s proves the point that exploration is expensive and usually unsuccessful.

But perhaps the biggest risk is the promise of a Government-led “transition” to new industries of the future. Airy ministerial talk of capital being redeployed to new activities is a carbon copy of Rogernomics-era rhetoric. Capital was redeployed, but not necessarily in New Zealand.

The Government is talking a big game on its ability to direct the emergence of such new industries, but its capacity to deliver this upside of transformative change is untested and the value of the industries it is disrupting is all too measurable.

While radical change was necessary then ‘Rogernomics’ was executed hurriedly with more hope or desperation than planning.

Tim Watkin takes the similarity with Rogernomics style reform-and-hope policies, as opposed to David Lange’s ‘anti-nuclear moment’ – Oil be alright. But has Labour learnt the wrong lesson from its past?

Jacinda Ardern has drawn on our national pride in New Zealand’s nuclear-free stance to rally support for her decision to end offshore oil drilling. But her announcement has echoes of Douglas and Prebble as much as Lange and Palmer

When Jacinda Ardern was asked to justify her government’s decision to stop issuing oil drilling permits forthwith she drew on a memory that sits deep in her party’s – and our country’s – soul. Our nuclear-free status. The decision for me, however, recalls another controversial move by that same fourth Labour government.

For Ardern and her team, so long out of government, it is a chance to do the sort of thing they expect Labour government’s to do. The moral thing. Policies that show vision and make the world a better place. What’s more, it shows leadership in the Pacific.

As with our nuclear-free policy, the decision to leave the oil where it is gives New Zealand the moral high ground, a sense of mission and it gets us noticed. It’s also similar in that it will also do next to nothing in the short term to change global behaviour or make the world safer.

Our nuclear-free stance has been largely symbolic, as will this stance be, unless or until the rest of the world follows suit.

Like Rogernomics, last week’s decision was announced with no real consultation and ruthless speed. There was no time for opponents to circle the tankers. Like Rogernomics, it moved Labour away from the safe centre and took it to the edge of mainstream politics. And like Rogernomics, they have shown no sign that they have planned for the consequences – forseeon or unforseen – of this policy.

Talk to members of the fourth Labour government today and few resile from the thrust of the economic reforms, but almost all wish they had done it differently. More slowly, with transition funding and re-training upfront. With more consultation. More commitment to not leaving some people on the scrapheap.

Sadly, there’s no sign this government has heeded that lesson. Not yet anyway. The announcement came with the zeal of the nuclear-free dream, but without the legwork. There was no transition fund announced. No plan to find new purposes for the people and their skills. No three year grace period, for example, in which the country’s fourth largest export-earning industry could start on what Greens co-leader James Shaw has promised will be a “gentle transition”.

One could forgive Shaw and the Greens for being naive, given their lack of experience in power. The same could be applied to Ardern – but as Prime Minister she should be better advised. She seems to have believed her lofty hype over leading a generational change on climate change.

It is becoming increasingly apparent that the new Government was woefully unprepared for taking over. They have taken some quick and bold moves – like committing to major spending (handouts) for fee-free tertiary education – and leading the charge against climate change without any sign they know where this will take New Zealand economically.

But by embarking on this in a sudden, even sneaky, way and without a considered and consulted transition plan, it’s undermined the ‘what’ by buggering up the ‘how’. Labour has failed to learn from its own history. Or, at least, the part of its history Ardern says inspired this bold move. The question now is whether the government moves rapidly and with proper thought to live up to its promise of that “gentle transition”.

There is time for getting it right, or at least better and less risky, but there is no sign of this being recognised by the Government.

Another unlikely critic is Brian Fallow: Exploration ban a pointless, self-righteous policy

Resounding cheers greeted Jacinda Ardern and James Shaw when they went to Victoria University last Thursday to explain that morning’s announcement that no more offshore oil and gas exploration permits will be granted.

Gratifying to their ears, no doubt — but entirely undeserved.

This policy is self-righteous nimbyism, environmentally pointless, economically costly and politically counter-productive to the Government’s own agenda on climate change.

Tossing a trophy to the Green Party base, perhaps in the hope of reducing the risk that the Green vote gets wasted in 2020, smacks of ad hoc partisan politics as usual.

It is utterly at odds with the careful, consultative, consensus-seeking approach being pursued over the larger climate agenda.

James Shaw has set up a committee (according to National the 75th committee/group of this Government) to consult over climate change transition but as pointed out in Climate Change Committee announced, significant omissions this notably lacks direct representation from the key farmer and oil & gas industries.

Is there anyone in Labour capable of doing the hard work necessary to make such a transformative  policy work successfully without too many risks and adverse effects?

With Shaw in charge of the Climate Change ministry the only Labour MP (apart from Ardern) with related responsibilities is Megan Woods as Minister of Energy and Resources, and Minister of Science and Innovation, things that will be (or should be) a prominent part of the climate change/fossil fuel transition.

Little warns and assures Taranaki on oil and gas

After the Government announced they would not issue any more offshore oil and gas exploration permits the reaction was swift, as was the despatch of Andrew Little to Taranaki to try to placate the oil and gas industry dependent region.

Little grew up in New Plymouth, but twice failed to win an electorate seat there (in 2011 and 2014) before opting to go list only for last year’s election.

Little is still working on belated Government PR, through an opinion piece in the Taranaki Daily News – What do we do when we can no longer rely on the black stuff?

Last week’s announcement that no new block offers for offshore oil and gas exploration was long term notice that change is happening.

Because the reality is the world is changing.

Just about every government in the world signed up two years ago to the Paris Accord to reduce the planet’s carbon emissions and reliance on fossil fuels.

Donald Trump has since withdrawn the US.

The Accord isn’t just nice words. Countries are expected to do something about the commitment they have made.

The need for action is obvious. The world is facing ever more extreme weather events, including here in New Zealand. It is putting people and livelihoods at risk.

For a country whose main exports are climate-dependant, we have a big stake in how the world deals with climate change.

The car industry is starting to prepare for a different world. Volvo and other European car makers will abandon internal combustion engines in the next 20 years. The Japanese are well ahead in electric vehicle technology and the irrepressible Elon Musk says he is only a few years away from an electric heavy goods vehicle.

Oil companies like Shell are changing. They are moving away from fossil fuels to renewable energy technology as part of their commitment to reduce their emissions, and also because consumers are demanding it.

Shell’s departure from New Zealand is part of its plan to focus on its remaining oil and gas reserves that it knows it can viably produce at US$40 a barrel.

In New Zealand, it isn’t viable to explore at US$70 a barrel. In the last few days, there has been an understandable focus on the impact of the government’s announcement on jobs and industry in Taranaki.

Little warns that the world of energy is changing, but switches to assuring that it won’t change too much too soon for Taranaki.

That is why last Thursday’s announcement made it clear that only future permits would be affected. All existing 22 permits in Taranaki continue unchanged. Existing exploration and production rights are unaffected. Onshore permits will continue to be let in Taranaki for the next three years, and there will then be a review about what happens after that time.

Let’s be clear about what existing rights actually mean. The 100,000 square kilometres of area offshore that is permitted but not yet explored can still be explored.

Viable reserves that are discovered can still be put into production.

Existing fields under production, like Kupe, can still be further developed as additional reserves are discovered.

Long term supply contracts vital to businesses like Methanex will be unaffected, and there will continue to be new supply opportunities into the future.

This industry will be around for another 30 to 40 years at least. Job losses from the industry are a long way away. There is a decent amount of time for local leaders and the government to work on the transition.

That’s if the current policies remain. What if the Greens get into a more dominant position in Government? That’s quite possible quite soon – if Labour and Green maintain their current support levels, and NZ First fails to make the threshold, Labour may end up relying on the Greens alone in a coalition starting in 2020.

If so it is reasonable to expect Greens to push for faster transition from fossil fuel extraction.

There is no leadership in hoping we can hold on to the status quo forever.

Leadership means anticipating the threats to our national livelihood, looking through short term political cycles and doing the right thing.

Business leadership in Taranaki will no doubt be trying to anticipate threats to their livelihoods. So will employees of oil and gas related businesses.

I look forward to playing my role in this great region’s future.

Little is curiously linking himself to leadership here, while it looks like he is on a mission of appeasement for Ardern.

If he really wanted to represent Taranaki as New Zealand transitions from oil and gas he could have another crack at standing for an electorate there again. But maybe his mission is more short term than that.


Not quite a ‘nuclear free’ moment on climate change

Jacinda Ardern ramped up climate change and fossil fuel debates this week when announcing a freeze on any more off-shore oil and gas exploration licenses. While she may have put the cart before the horseless carriage this is really just the beginning of ‘a conversation’ – aka consultation – on New Zealand’s future energy use.

Nadine Higgins: Jacinda’s ‘nuclear-free moment’ puts Government one step ahead of the public

On the campaign trail, Jacinda Ardern declared climate change was this generation’s “nuclear free” moment.

When her Government this week announced new offshore oil and gas exploration permits would no longer be granted, the pundits went further, asking, was this her nuclear-free moment?

But I think the answer is no, not quite.

I can’t be sure whether Jacinda smelt fossil fuels on anyone’s breath, but the clear difference is New Zealand’s opposition to nuclear weapons was driven by public opinion. Even as US relations were dealt a major blow, the majority still supported the Government drawing our nuclear-free line in the sand.

This line in the sand, however, appears to have been drawn before the public has caught up, if the outcry from oil-reliant regions, mayors, companies and motorists is anything to go by.

That feels like it’s all round the wrong way.

It is round the wrong way – it’s notable that the Greens have applauded the move while seeming to conveniently forget their commitment to sound democratic processes. It seems that if the cause is important enough (for the Greens) then due democratic process doesn’t matter.

I think this highlights an arrogance from the Greens – they think that their cause is so just that if they push it through the public will automatically support it and vote for them in hordes. That is not based on any history or facts.

So, the move away from reflectorship back to leadership is a little jarring, but that doesn’t make it wrong.

There have been many reforms that went against the tide of public opinion at the time but were later lauded as a seminal moment in history that happened not a minute too soon.

I think about the reform that legalised homosexuality in the 1980s and can’t believe it was ever illegal in my lifetime.

The Civil Union Bill in the 2000s drew thousands of protesters out into the street. Yet a little over a decade on, civil unions barely even rate a mention because of the passage of the Marriage Equality Act.

While important as social reforms they were on a far different scale to a massive move away from the fuels that the last century and more of progress has been built on.

It might not feel like it now, but we’ve got a bit of time to figure this out, and time to get the public on the right side of this history-making line in the sand.

I think Higgins is right here.

After making her announcement (with mixed messages, especially from Shane Jones) and getting an immediate and strtong reaction Ardern launched into damage control by sending Andrew Little to New Plymouth to try and win over people who had twice refused to vote him in as their MP.

There is time to get this right. Ardern has to step up and show leadership here, and that means more than regular photo ops.

This is a flagship change policy for the Green Party, so it’s important that they put aside their self righteousness and arrogance and engage in explanation and debate with the public rather than dictation, and indignation at any criticism.

James Shaw has championed climate change as his big thing. He beamed at the announcement on curbing exploration a few days ago.

Shaw needs to convinced his Green supporters that promoting their cause will be enhanced somewhat if they engage with the general population, and persuade their case rather than impose it. And they need to learn to not throw hissy fits if questioned or criticised – that’s not how good democracy functions.

And Shaw needs to make his case to the wider New Zealand audience, beyond his Green bubble.

With such a wide ranging change being promoted Greens need to widen their scope somewhat. I remember being disappointed before the 2014 election when Greens announced a solar energy subsidy policy. I asked them why they didn’t include energy conservation through subsidising double glazing retrofits, and they said it wasn’t their current focus. That was disappointing tunnel PR vision.

If Shaw and Ardern fail to get the public on their side their grand ambitions may fall over as soon as the 2020 election.

Good should come out of their push for more energy alternatives, but if they want to succeed with a major transformation in Kiwi attitudes and energy use they need to practice what they preach, transparency and sound democratic processes.

They have time to get it right, but the need to get it right, or their big aims will be put on hold or overturned by a grumpy bunch of voters.

We await concrete Green action, and can do without the nutters

The Labour led government banned oil and gas exploration on Thursday, sort of, permits anyway, in the future. It has dismayed NZ First and the Greens are ecstatic, in what may be a largely symbolic move. But it has risks, including:

  • It could deter investment in the existing and non-banned fossil fuel recovery industry based largely in Taranaki
  • If it stops future gas recovery it could increase our reliance on existing dirtier coal energy if the Greens don’t get their way and ban that too)
  • It could force New Zealand to import more expensive energy to meet our needs.

Green co-leader James Shaw followed up yesterday launching a ‘preliminary survey’ of finance for climate related economic activity.

“There are huge opportunities in the clean economy. Today I’m launching a report into how we can finance the transition to net zero emissions, creating jobs in new industries and upgrading our economy to be more resilient.”

The greens claim that alternative energy offers huge business opportunities – see Green report – climate finance in New Zealand.

But there is still a lack of concrete proposals on post fossil fuel clean green optionn. Green ideals need to be translated into viable opportunities.

Shane Cowlishaw (Newsroom): Real climate challenge lies ahead

Tasked with creating many of those next steps will be a new, independent watchdog.

The climate commission will be established under the Zero Carbon Act, with an interim committee soon to be announced while the permanent body is set up.

Alongside its job of holding the Government to account for its progress on greenhouse gas emissions, it will also provide advice on setting targets, reducing emissions and addressing climate risks.

It has its work cut out for it.

On the face of it, the decision to ban new offshore exploration permits will have little effect on our use of oil and gas.

Until people’s habits change or new taxes on fossil fuels are introduced, the country will continue to import what it needs from overseas.

Last week Jones was in Taranaki to soften the exploration ban blow, announcing $20 million of spending for the region.

It included $150,000 on new energy initiatives, but the major money was for the restoration of a cathedral and better walking tracks.

That won’t replace the loss of the oil and gas sector. New industries will be needed.

Shaw told media he believed the end of exploration would be a boon for the economy rather than a hit, as clean energy industries surged forward.

“It does represent, I think, the greatest economic opportunity in at least a generation for the creation of new jobs and new technologies that our dependence on fossil fuel has held back for too long.”

At this stage, however, talk is cheap and unless real solutions are put forward the Government risks watching the exploration ban thrown out at the next election.

The Greens have talked up their vision for a vastly different energy and economic environment to what we have now.

They have succeeded at getting into Government. They have succeeded in making a mark with the ban on future oil and gas exploration permits.

They have a much bigger task ahead of them – proving their ideas are not just unrealistic ideals, and coming up with concrete alternatives.

And no Robert, I won’t just give the promoters of the revolution a blank cheque and ‘trust the Greens’.

In principle I support many of their aims. I think that we need to make a much better effort in transitioning away from our reliance on fossil fuels, for a number of reasons, including pollution, the environment, the climate, and the economic risk – a war in the Middle East could throw New Zealand into chaos. We have already had major change forced on us by the oil shocks in the 1970s.

But I have concerns about some of the Green aims, and what impact their ideals could have. Some of them can’t avoid having adverse effects, any major change does.

It’s time now for the Greens to step up and prove their worth. They have only just begun and are a long way off having a convincing alternative at this stage.

One thing that would help them gain support is to ditch extreme targets. Zero carbon, zero road deaths, zero poverty are so fanciful they are easily dismissed as pie in the polluted sky.

They need to convince the people of New Zealand that there are benefits from radical change – and that will mean not being too radical, at this stage at least.

A goal of halving emissions would be difficult enough – and even that is too vague for people living everyday lives.

Trying to force things like bikes and trains on people risks resistance.

Greens need leadership that works with the people, for the people rather than for the few percent of their loyal supporters.

Green zealots who think that their way is the only way, and who are  are intolerant of criticism and being held to account, are likely to continue to be detrimental to the cause.

If the Greens want to win the PR battle they need to start by convincing their own of a reasonable approach to radical change. Otherwise they risk being dismissed as nutters.

Q&A: Greenpeace and fossil fuels

Greenpeace was declined charity status this week because of their activist activities and law breaking – see Greenpeace declined charity status.

Prime Minister Jacinda Ardern has given mixed signals about what the Government’s position is on the use of fossil fuels and on oil and gas exploration. She has said that climate change is the issue of the time, and received a petition against exploration that Greenpeace presented to Parliament recently, but she has been vague about what they will actually do.

This morning on Q&A theor director Russel Normal is interviewed about fossil fuels.

Farewell fossil fuels?
Greenpeace executive director Russel Norman is on the programme today to explain why New Zealand must end all new oil and gas exploration.

Incremental v. ‘a radical and immediate departure’

Can we incrementally move towards renewable energy sources and reduced pollution and gradually clean our waterways, or do we have to take radical and immediate action to save the planet?

Green MP Gareth Hughes seems to have a softer approach to drilling oil:

Stuff: Region could become renewable energy powerhouse

Hughes was in New Plymouth on Monday to help select the Green Party candidate for the Taranaki-King Country electorate to contest this year’s election.

The party’s energy policy was to stop deep sea drilling greater than 100 metres and allow shallower inshore exploration drilling.

A ‘no drilling’ stance in Taranaki would not be good for getting party votes. Is this is why there is apparent electorate pragmatism, or does it signal a softening of approach to oil drilling and fossil fuels from the Greens?

Their Climate Change policy talks of a fossil-free economy and “deep reductions in greenhouse gas emissions as a step towards achieving zero emissions as early as possible”. Hughes:

“We can’t keep burning the stuff forever but no one is willing to put a date on it, or implement a plan around it.

I can’t find Greens putting a date on it, just that they want zero emissions as soon as possible.

But some want more urgent, more drastic action.

From a post at The Standard:

One of the speakers at Dunedin’s March for Science was a young woman by the name of Charlie.

Charlie knows that any talk of  transitioning to a low or zero carbon future is ‘off the table’. She knows that all the renewable resources being developed are far too little and far too late, and anyway, are being deployed on top of existing fossil sources of energy – not replacing them.

She gets that investing hope in impossible or improbable  technologies (BECCS) in impossible timeframes (less than 20 years) that sets a world of logistics off to one side, is just plain stupid and disempowering.

She’s cognisant of the fact that this isn’t ‘the Anthropocene’ as many like to claim – that it’s a small percentage of humanity that is responsible for global warming and not the entire human race fulfilling some kind of dark manifest destiny.

In a nutshell, Charlie, and I dare to hope a good number of other young people, fully understand that incrementalism – that which essentially amounts to running down the train tracks to avoid the locomotive of global warming, isn’t the direction to go in and is no kind of strategy at all.

Charlie’s aware we need a clean break – a radical and immediate departure. She looks to her possible futures and sees that only revolutionary ones contain prospects.

If even the Greens seem to be nowhere near (at least talking about) a radical and immediate departure from current policies and uses of fossil fuels then the likelihood of radical change seems very unlikely.

Charlie pointed me to the following observation made by Tim DeChristopher – “If we want to change the status quo, we might have to work outside of some of those rules because the legal pathways available to us have been structured precisely so we don’t make change.”

A suggestion they would resort to illegal actions?

Charlie, or Bill, don’t give any indication of what they would do or try to change urgently, they just hint at something revolutionary. Bill left ‘the last word’ to Charlie:

“I believe there is nothing more radical than burning more coal, oil and gas despite the urgent call for drastic climate action by frontline communities. There’s nothing scarier than the future of our planet, which our lives depend upon, being decided by a few powerful people.

The power to change the world right now is not democratic, but belongs to a few people. We can change that now.”

This sounds passionate but very vague. In comments Bill addressed the last word:

I’m going to go with Charlie’s last sentence and suggest that embracing and developing democratic bases of power is the way to go…in other words, bring the power back to where it rightfully belongs.

That’s not a quick fix and we don’t have time on our side, so we’d do well to start on it today.

Talk to your family, friends, acquaintances, work mates…see what you can come up with. It might only be something very small to begin with, but small things can spread and small things can grow – sometimes quite fast too 😉

There’s some interesting comments on this: Thank you Charlie.