The Electoral Commission’s purple flyer on the End of Life Choice
Act should be in your letterbox. We know the legislation inside out
and we want to tell you it is good, accurate information. However,
there is going to be a lot of misinformation to correct. Besides the
Electoral Commission’s flyer, we highly recommend supporting Yes For
Compassion. They are the ‘yes’ campaign for this referendum and they
need your support to counter the anti-choice brigade. Please sign up
and be counted with them here.
Tiwai The Free Market Way
Sometimes the issues of the day can benefit from a little history.
Free Press has family history going back to the smelter’s
construction. Why was it built in Southland? Because Lake Manapouri
always had the potential to provide a huge amount of electricity that
would be hard to transmit north.
Like so many problems, Muldoon is partly responsible. The deal was
that Tiwai Point would get electricity at cost-plus from Manapouri.
Muldoon was a cynical bully. Tiwai made a profit so he took it,
reneging on the deal and ramping up the electricity price for Tiwai.
The reputation of the whole country in the eyes of foreign investors
The problem Muldoon started still exists under current laws. Tiwai
cannot take advantage of the basic physics that made it a good idea in
the first place: it’s close to a really big generator that’s not close
to much else. It pays around $65 million per year for transmission
just to get electricity from Manapouri to Tiwai Point. They would pay
the same if they built it in Kaitaia. The weather is better but
transmitting that much power 1500 kilometres is nuts. The current
rules mean prices don’t reflect physical reality.
Manapouri is not connected to the national grid, at least not well
enough to supply the rest of the country. If Tiwai closes, new lines
will have to be built to transmit power north instead. This will cost
a fortune and surplus electricity from Manapouri will have to be
dumped while it’s built. Note that a new line will have to be built if
But, But, But No. 1
There exists in the Electricity Code a special provision called
‘prudent discount.’ If a customer can realistically get cheaper
transmission pricing than using Transpower’s network, Transpower
should give them a ‘prudent discount.’ The idea is to stop them doing
something stupid such as moving offshore or building their own
generator or transmission line. In theory, at least, NZ Aluminium
Smelters could build their own line from Manapouri to Tiwai, invoking
the prudent discount rule.
But, But, But No. 2
This is New Zealand in 2020. Build a transmission line through the
Southern Alps across conservation land? We have the RMA. We’re
grateful when the local council lets us build a deck. So an
alternative is not viable and the prudent discount can’t be invoked.
Tiwai is closing because of transmission costs. Transmission costs are
high because of the RMA and the general opposition to building near
absolutely anything in New Zealand.
The Government is legislating all sorts of crazy projects at the
moment. If it was to do one thing, it should be this. Legislate that a
transmission line is consented between Manapouri and Tiwai. They are
not going to build it. Transpower will have to give them a discount on
transmission. Ironically, legislating a line to be built means one
won’t be built, but failing to do so means a new line will be built to
take power north. We suspect this manoeuvre will make the smelter
viable, the way it was originally planned. If it doesn’t, maybe they
really should close?
Intervening With A Clear
This is an intervention, but it is one free marketeers can support
with a clear conscience. We are simply returning a modicum of sanity,
as if we are a country where it is possible to build without the RMA.
It is good for reducing carbon emissions, because Tiwai uses
hydroelectricity and is low emission compared with coal powered
smelters in China, for example. It is good for jobs. It is good for
the New Zealand economy. The next government must legislate a
transmission line from Manapouri to Tiwai.
Why We Need
ACT is the party of consistent, constructive and principled
thinking. So many people are turning to ACT because of our approach to
making New Zealand better through better public policy. If ACT sounds
like your voice, please consider joining,
(or all three) to support ACT this election.