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Meridian Energy : submission - Emissions Reduction Plan - November 2021

11/24/2021 | 03:30pm EST

24 November 2021

Submissions

Ministry for the Environment

By email: climateconsultation2021@mfe.govt.nz

Emissions Reduction Plan - Te hau mārohi ki anamata

We are strongly supportive of the introduction of a meaningful Emissions Reduction Plan (ERP) to support Aotearoa in making the shift to a net zero future - thank you for the important opportunity to provide feedback on the ERP discussion document.

A little about who we are

Meridian is Aotearoa's largest renewable energy company. Our purpose is clean energy for a fairer and healthier world.

We produce energy from 100 percent renewable sources (wind, water and sun). Our hydro stations and wind farms generate enough electricity to power around 1.7 million and 200,000 homes respectively each year.

We are committed to meeting future energy needs with renewable energy and taking action on climate change, with benefit for the people of New Zealand front of mind. Some of our current projects include construction of a new wind farm (Harapaki in the Hawke's Bay), investment in a nationwide network of electric vehicle chargers, supporting our customers to decarbonise process heat through electrification, and exploring the opportunity to build the world's first large-scale green hydrogen plant in Southland.

We have previously provided detailed feedback to the He Pou a Rangi - Climate Change Commission (CCC) consultation on their 2021 draft advice to the Government1. Below we have summarised our main messages on the ERP discussion document. Appendix A contains our thoughts on some of the questions in consultation.

1 https://www.meridianenergy.co.nz/assets/Sustainability/Meridian-submission-CCC-2021-Draft- Advice.pdf

Meridian Energy Limited

Level 2, 55 Lady Elizabeth Lane

Phone +64-4 381 1200

PO Box 10-840

Fax +64-4 381 1272

Wellington 6143

www.meridianenergy.co.nz

New Zealand

The current challenge for the government is to set targets and policies that will deliver meaningful and urgent emission reductions

The success of any of the revised targets agreed at COP26 - particularly long-term net zero promises - will depend on whether they are translated into meaningful near-term commitments. Any actions Aotearoa can take to bend the emission curve downwards this decade helps our planet keep the 1.5 degree target alive. It's essential that the ERP provides the frame and guidance so Aotearoa can take the material action required to transition and thrive in a net zero future.

However, the ERP has been delayed, and there remains a gap between the proposed first emission budget and estimated emissions reduction. This is disappointing. The earlier we take concrete steps to abate emissions, the greater the gains.

We strongly support the recommendations of the CCC and agree that priority areas for action include increasing the number of electric vehicles on our roads and increasing our total renewable energy use, particularly in industrial heating and other areas where fossil fuels are still used. We see a fully developed and all-encompassing Emissions Trading Scheme (ETS) as the key policy tool, but we also acknowledge that additional policies will be necessary. For example, in transport and industrial heat, additional policies are needed to ensure that investments in vehicles and heating infrastructure today do not lock in emissions for the next 30 years. We also strongly support the requirement that Aotearoa goes through this transition in an equitable and inclusive way, to ensure we build a thriving future for all New Zealanders.

We acknowledge the range of ideas tabled in the discussion document to try to close the gap. However, we think that it is time for concrete and urgent action.

We encourage the government to find the right balance between landing meaningful, tangible abatement in the short-term, while also developing new ideas for implementation in the longer-term.

There are changes that government could make which would make the transition smoother and faster

We have some ideas to suggest:

  • Set a clear time-bound renewable energy consumption target, with interim targets, that a nation can mobilise itself behind.
  • Put climate change at the heart of the Natural and Built Environment Act, in the purpose provision. Consenting is a major complication in building more renewable energy. It is essential that the new Act enables electrification of sectors currently dominated by fossil fuels such as transport and industrial heat. To meet this increase in demand, new renewable generation will need to be built. We think that the new Act should recognise that there are times when the need for climate change mitigation and adaptation should prevail. We also think that good climate change outcomes can (and should) co-exist with good biodiversity outcomes.
  • Promote a swift and sustained uptake in low emissions transport, with practical and real-world support. The transition is going to require investment and policy change as we adapt roads, charging facilities, airports and marine environments to support electrification. We think that the new hybrid restrictions (for 2037) are a bit out of step with the international commentary, which positions these as a transition tool over 2015-2025. These longer-term hybrid restrictions should be targeted to heavy commercial fleets. We think that investment in EV charging infrastructure would

2

Meridian Submission - Emissions Reduction Plan consultation: Te hau mārohi ki anamata - 24 November 2021

benefit from a review of policy to ensure that this market is eventually self-sustaining. We would also like to see the government make data sets available to the market to improve EV infrastructure investment. We see a need for a review of policies and regulations to decarbonise aviation, as trailblazers like Sounds Air make commitments for electric aircraft by 2026. Finally, we would also like to see attention given to the changes needed in the marine environment where electrification can enable decarbonisation (for example, the costs of transformers being borne by early adopters will be a barrier to transition, when central and local government could instead be owning and planning for these costs).

  • As far as possible, streamlining approval processes such as consenting for new renewable generation, and ETS forest registration. Faster and more flexible approval processes will help us to build renewable generation and play our part in managing biodiversity risks.
  • An awareness of the role that demand response and other sources of system flexibility over various timeframes can play in enabling a highly-renewable electricity system in New Zealand. Some industrial consumers such as the green hydrogen production facility planned by Meridian and Contact can provide large scale demand response, which could effectively replace fossil fuel reserve plant. This could address New Zealand's dry year risk, deliver security of supply in a highly-renewable system, and lower electricity prices, while also reducing emissions.
  • More support for initiatives such as the GIDI fund, that lower emissions by co-funding transition projects. We know this is having a material positive impact for large companies committed to transitioning to clean energy and closing the emissions gap now.

We accept the invitation made to business to demonstrate climate action commitment and we are focused on making a significant contribution for Aotearoa

It is clear, based on the latest available science, that urgent and decisive action to reduce emissions is essential to mitigate the impacts of climate change and preserve our way of life. In order to limit warming to 1.5 degrees, immediate, strong and sustained reductions in carbon emissions are required.

Meridian is embracing the opportunity to be at the forefront of emissions reduction activity. We have many examples of practical, positive steps we are taking to assist with climate action:

  • We are building a pipeline of renewable generation to meet the increase in demand for clean energy. Current examples include a $395 million wind farm in Harapaki, 2 designing a 100MW battery (estimated size) in the North Island, 3 a proposal to build the world's first large-scale green hydrogen plant in Southland4 And investing in grid scale solar. 5 Our vision is to increase investment in this pipeline, with our intention being to build a new wind farm every 2-3 years.

-

  • We have been committed to carbon neutral operations since 2019 through the use of Gold Standard Verified Emission Reductions, with plans to transition and achieve
  1. Harapaki wind project | Meridian Energy
  2. Meridian to Commission NZ's Biggest Battery to Avert More Black-Outs | Newsroom
  3. Southern Green Hydrogen

3

Meridian Submission - Emissions Reduction Plan consultation: Te hau mārohi ki anamata - 24 November 2021

this via our Forever Forests, which are investments in predominantly native permanent forestry in Aotearoa. We are also committed to halving our gross emissions by 2030 (including scope 3 emissions).6

  • We are very active in converting process heat to electricity. We recently assisted two major primary processors, A2 Milk Company and the Alliance Group to electrify coal- fired boilers as part of Meridian's programme to help decarbonise industrial process in the South Island.7 This is in addition to announcements earlier this year about Meridian's support for the electrification of process heat at ANZCO and Meadow Mushrooms. We are continuing to support other industrial customers on a similar pathway.
  • We have committed to delivering a nationwide network of 250 electric vehicle AC charging stations and are working with customers to advance our first deliveries now.

Meridian strongly supports decisive, collective action to achieve a cleaner, fairer and healthier world. Increasing renewable energy generation will play a key role in decarbonising our economy over multiple sectors. We are committed to playing our role to deliver an urgent reduction in emissions.

Tina Frew

Head of Sustainability

Evealyn Whittington

Senior Regulatory Specialist

  1. https://www.meridianenergy.co.nz/who-we-are/sustainability
  2. Electricity to replace 1,000 coal trucks in Southland (meridianenergy.co.nz)

4

Meridian Submission - Emissions Reduction Plan consultation: Te hau mārohi ki anamata - 24 November 2021

Appendix A: Responses to consultation questions

Question

Response

1.

Do you agree that the emissions

We agree that the ERP should be supported with principles. The principles outlined cover

reduction plan should be guided

important elements but some additional framing or detail would aid with clarity of intent. For

by a set of principles? If so, are

example:

the five principles set out above

A fair, equitable and inclusive transition. The description of 'minimise and avoid the

the correct ones? Please

explain why or why not

negative impacts….of the transition….' does not read as 'fair'. For example, 'fair' is

arguably not 'leaving too much of a burden for future generations' - what is too

much? Also, it is not clear what 'exacerbating environmental issues' is referencing.

Environmental and social benefits beyond emissions reductions. This feels like the

collapsing of several distinct and important pieces.

A clear, ambitious and affordable pathway. A sense of urgency and bias to delivering

abatement at pace and scale is absent in the description of this principle. We call for the

pathway to ensure a 1.5-degree future is kept alive. We also support the Climate Change

Commission's focus on reducing gross emissions and believe this could be articulated within

this principle (or added as one).

2.

How can we enable further

Ambition, capital and capability exists in the market to deliver significant emissions abatement.

private sector action to reduce

Meridian is committed to bringing to market significant new renewable energy generation,

emissions and help achieve a

scaling existing transport and process heat decarbonisation offers. We are also actively

productive, sustainable and

advancing a possible future hydrogen economy. Key barriers that if removed would help

inclusive economy? In

increase the pace of delivery and/or confidence to invest include:

particular, what key barriers

Meridian Submission - Emissions Reduction Plan consultation: Te hau mārohi ki anamata - 24 November 2021

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

Meridian Energy Limited published this content on 24 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 November 2021 20:29:01 UTC.


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