1 00:00:00,080 --> 00:00:03,160 Speaker 1: Shange Jones pushing ahead with his desire to implement a 2 00:00:03,240 --> 00:00:07,720 Speaker 1: thing called special Economic Zones to boost electricity generation and 3 00:00:07,800 --> 00:00:12,080 Speaker 1: to secure fuel. Now the zones will create tailored regulation 4 00:00:12,280 --> 00:00:16,440 Speaker 1: policy and special access to financial support for those in 5 00:00:16,520 --> 00:00:21,120 Speaker 1: areas deemed desirable for generation. So John Harvard is the 6 00:00:21,239 --> 00:00:24,119 Speaker 1: chair of the Major Electricity Users Group, then joins who Now, 7 00:00:24,160 --> 00:00:24,959 Speaker 1: good warning to John? 8 00:00:25,680 --> 00:00:26,160 Speaker 2: Good morning. 9 00:00:26,560 --> 00:00:29,200 Speaker 1: So is Shane jones idea a good one? Will it 10 00:00:29,240 --> 00:00:30,880 Speaker 1: get more dams and wind farms built? 11 00:00:32,040 --> 00:00:34,920 Speaker 2: Look? It certainly would help. One of the big problems 12 00:00:34,960 --> 00:00:36,960 Speaker 2: we have in New Zealand is it's very hard to 13 00:00:36,960 --> 00:00:39,440 Speaker 2: build things, and there's no question that we need a 14 00:00:39,479 --> 00:00:43,800 Speaker 2: lot more generation built. It doesn't remove issues around sort 15 00:00:43,800 --> 00:00:47,000 Speaker 2: of access to finance potentially, and it doesn't change sort 16 00:00:47,000 --> 00:00:49,640 Speaker 2: of the fundamental dynamic we have in New Zealand that 17 00:00:49,840 --> 00:00:53,440 Speaker 2: our large generators tend to only build new generation when 18 00:00:53,479 --> 00:00:56,200 Speaker 2: the demand is already there for the new build. So 19 00:00:56,240 --> 00:00:58,200 Speaker 2: we always sort of lag behind a little bit in 20 00:00:58,280 --> 00:01:00,800 Speaker 2: terms of very electricity generation and that's one of the 21 00:01:00,800 --> 00:01:02,280 Speaker 2: reasons why prices stay high. 22 00:01:02,400 --> 00:01:05,080 Speaker 1: Do you think this might encourage more independent generators to 23 00:01:05,360 --> 00:01:07,800 Speaker 1: set up shop because we've got the big four gen tailors, 24 00:01:07,840 --> 00:01:09,840 Speaker 1: you know, and it's a bit like the supermarkets as well. 25 00:01:09,920 --> 00:01:12,360 Speaker 1: Would this actually create more competition. 26 00:01:12,880 --> 00:01:15,640 Speaker 2: Well, it'd be really interesting to see what the Minister 27 00:01:16,080 --> 00:01:19,160 Speaker 2: is thinking about in terms of access to finance. So 28 00:01:19,200 --> 00:01:23,959 Speaker 2: the big problem for independent generators is raising the capital 29 00:01:24,040 --> 00:01:26,759 Speaker 2: they need to actually build the generation, so they look 30 00:01:26,800 --> 00:01:32,280 Speaker 2: for a long term, large contract to underpin that investment. 31 00:01:32,680 --> 00:01:35,800 Speaker 2: The problem is most of the generation is wind and solar, 32 00:01:36,680 --> 00:01:39,560 Speaker 2: so it's intermittent generation because the wind doesn't blow all 33 00:01:39,560 --> 00:01:41,200 Speaker 2: the time and the sun doesn't shine all the time. 34 00:01:41,600 --> 00:01:44,880 Speaker 2: But our large users like as steel makers and our 35 00:01:44,959 --> 00:01:48,120 Speaker 2: your minium makers, they need a really constant supply of 36 00:01:48,160 --> 00:01:51,560 Speaker 2: electricity all the time. So what tends to happen is 37 00:01:52,200 --> 00:01:55,560 Speaker 2: the only sort of big players that the independent generators 38 00:01:55,560 --> 00:01:58,400 Speaker 2: can sell to are the big four gentators, So you 39 00:01:58,400 --> 00:02:01,680 Speaker 2: don't fundamentally change the dynam and if you're a gentailor, 40 00:02:02,640 --> 00:02:04,840 Speaker 2: you're a lot of building it yourself than buying it 41 00:02:04,880 --> 00:02:07,680 Speaker 2: off someone else. So there's a real challenge there for 42 00:02:07,720 --> 00:02:10,720 Speaker 2: the independence to actually enter the market. So if the 43 00:02:10,720 --> 00:02:13,960 Speaker 2: Minister's got some good ideas around access to capital and 44 00:02:13,960 --> 00:02:15,640 Speaker 2: making that easier, that could make a difference. 45 00:02:15,680 --> 00:02:18,079 Speaker 1: Yes, and when those people come into the market, and 46 00:02:18,760 --> 00:02:20,760 Speaker 1: this is advice for the gentailors as well. I mean, 47 00:02:20,800 --> 00:02:22,320 Speaker 1: what would you like them to be doing. 48 00:02:23,919 --> 00:02:26,280 Speaker 2: Obviously we'd like them to be building a lot more generation. 49 00:02:27,480 --> 00:02:29,840 Speaker 2: They are building more at the moment, but we need 50 00:02:30,760 --> 00:02:34,200 Speaker 2: a step change in a large order of magnitude. To 51 00:02:34,240 --> 00:02:36,360 Speaker 2: put it in sort of perspective, is you know some 52 00:02:36,440 --> 00:02:39,480 Speaker 2: of the wind farms and the solar farms that are 53 00:02:39,480 --> 00:02:42,160 Speaker 2: being built, you know they might be twenty or thirty 54 00:02:42,200 --> 00:02:46,440 Speaker 2: megawatts of electricity a year. Well, we use about forty 55 00:02:46,480 --> 00:02:50,679 Speaker 2: five million megawats of electricity a year, so it gives 56 00:02:50,680 --> 00:02:53,000 Speaker 2: you an idea of how much we need to increase generation. 57 00:02:53,600 --> 00:02:55,720 Speaker 1: All right, We're round about eighty two percent, and thank 58 00:02:55,760 --> 00:02:58,040 Speaker 1: you John Harvard for more from. 59 00:02:57,960 --> 00:02:59,600 Speaker 2: Early Edition with Ryan Bridge. 60 00:02:59,639 --> 00:03:03,120 Speaker 1: Listen live to News Talks. 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