1 00:00:09,093 --> 00:00:12,693 Speaker 1: You're listening to a podcast from News Talk SEDB. Follow 2 00:00:12,773 --> 00:00:16,133 Speaker 1: this and our wide range of podcasts now on iHeartRadio. 3 00:00:16,653 --> 00:00:19,373 Speaker 2: We are talking about the use of New Zealand coal 4 00:00:19,933 --> 00:00:23,493 Speaker 2: to keep our electricity network stable. Joining us now is 5 00:00:23,533 --> 00:00:26,212 Speaker 2: Patrick Phelps. He is someone who knows a fair bit 6 00:00:26,253 --> 00:00:29,013 Speaker 2: about coal. He's the manager of Mineral's West Coast, a 7 00:00:29,053 --> 00:00:31,253 Speaker 2: group representing the mining industry on the West Coast, and 8 00:00:31,293 --> 00:00:33,893 Speaker 2: he joins us now. Patrick, Good afternoon. 9 00:00:33,613 --> 00:00:34,573 Speaker 3: Good afternoon to you all. 10 00:00:35,093 --> 00:00:37,333 Speaker 4: Patrick House, shaky is z agred. Why do we need 11 00:00:37,373 --> 00:00:39,733 Speaker 4: to have this huge coal stockpile? 12 00:00:39,773 --> 00:00:43,053 Speaker 5: And Huntley, Well, there's a lot of people take a 13 00:00:43,132 --> 00:00:45,533 Speaker 5: point of national pride, and you alluded to it before. 14 00:00:45,573 --> 00:00:49,493 Speaker 5: We've got quite a substantial hydro fleet around the country. 15 00:00:49,533 --> 00:00:53,293 Speaker 5: We've got Jeffermore, we've got wind. But even over the 16 00:00:53,333 --> 00:00:57,013 Speaker 5: last ten years, as we've become ever more renewable, and 17 00:00:57,773 --> 00:01:00,773 Speaker 5: looking at the figures for the previous decade generated anywhere 18 00:01:00,813 --> 00:01:06,213 Speaker 5: between eighty to eighty eight percent of electricity from renewables, 19 00:01:06,453 --> 00:01:08,813 Speaker 5: there's a balance there of anywhere between ten and twenty 20 00:01:08,853 --> 00:01:11,893 Speaker 5: percent that's not available from renewables, and you've got to 21 00:01:11,893 --> 00:01:14,253 Speaker 5: fill that gap, just as each of us needs one 22 00:01:14,292 --> 00:01:16,613 Speaker 5: percent of the oxygen that we breathe. We need every 23 00:01:16,652 --> 00:01:19,573 Speaker 5: percentage of electricity that we generate and use, and when 24 00:01:19,572 --> 00:01:21,973 Speaker 5: that's not renewables, it has to be some combination of 25 00:01:22,013 --> 00:01:22,932 Speaker 5: natural gas and coal. 26 00:01:23,773 --> 00:01:26,333 Speaker 4: And why Indonesian coal do we not dig this kind 27 00:01:26,373 --> 00:01:27,733 Speaker 4: of coal up in New Zealand? 28 00:01:27,932 --> 00:01:31,173 Speaker 3: This is a question I get a lot, so I 29 00:01:31,212 --> 00:01:33,133 Speaker 3: guess first things first is to just get some sense 30 00:01:33,133 --> 00:01:36,932 Speaker 3: of scale. New Zealand's coal industry as it is today 31 00:01:37,093 --> 00:01:40,372 Speaker 3: produces anywhere between two and three million tons of coal 32 00:01:40,453 --> 00:01:43,413 Speaker 3: per year. You know, at the highest I think New 33 00:01:43,493 --> 00:01:45,693 Speaker 3: Zealand's production has ever been, we might have produced about 34 00:01:45,733 --> 00:01:48,693 Speaker 3: five million tons a year back when there was more abundant, 35 00:01:49,053 --> 00:01:52,613 Speaker 3: low cost coal and YadA, as well as some other factors. 36 00:01:53,773 --> 00:01:55,213 Speaker 3: So if you sort of work off that figure of 37 00:01:55,213 --> 00:01:58,013 Speaker 3: anywhere between two to three million now and our peak 38 00:01:58,133 --> 00:02:03,613 Speaker 3: production never having been five million tons a year, Indonesia exports, 39 00:02:03,693 --> 00:02:07,613 Speaker 3: not produces, exports more than five hundred million tons of 40 00:02:07,653 --> 00:02:11,733 Speaker 3: coal internet nationally every single year. And it's thermal coal 41 00:02:11,773 --> 00:02:15,613 Speaker 3: for use in electricity generation or possibly direct heat in 42 00:02:15,653 --> 00:02:19,333 Speaker 3: some boilers. But you know, half a billion tons of 43 00:02:19,333 --> 00:02:23,773 Speaker 3: coal each year, and so that's one bit of the context. 44 00:02:24,293 --> 00:02:28,252 Speaker 3: Another bit of context is that in New Zealand, the 45 00:02:28,453 --> 00:02:32,013 Speaker 3: demand for that coal is largely, not exclusively, but largely 46 00:02:32,093 --> 00:02:36,293 Speaker 3: in the electricity sector, where some years Genesis Energy may 47 00:02:36,333 --> 00:02:38,813 Speaker 3: find that there's enough demand to justify burning two to 48 00:02:38,853 --> 00:02:41,613 Speaker 3: three hundred thousand tons of coal a year. Other years, 49 00:02:41,813 --> 00:02:44,293 Speaker 3: if the late levels are low, or potentially gas levels 50 00:02:44,893 --> 00:02:47,333 Speaker 3: gas productions low, it might earn more than a million 51 00:02:47,333 --> 00:02:50,532 Speaker 3: tons of years the coal a year. So that volatility 52 00:02:50,573 --> 00:02:52,973 Speaker 3: is quite substantial for a New Zealand industry that already 53 00:02:52,972 --> 00:02:56,532 Speaker 3: had a lot of customers. And you know, some of 54 00:02:56,573 --> 00:02:59,532 Speaker 3: the coal that we produce isn't used for generating electricity. 55 00:02:59,573 --> 00:03:01,493 Speaker 3: It's used for making steel, and so it's exported to 56 00:03:01,532 --> 00:03:04,413 Speaker 3: steel producers, and so that volatility is a big factor. 57 00:03:04,413 --> 00:03:06,093 Speaker 3: And then you just have to come to the conclusion 58 00:03:06,133 --> 00:03:09,213 Speaker 3: that well, as far as Genesis is consumed earned for 59 00:03:09,252 --> 00:03:10,973 Speaker 3: the cost that they're willing to pay and the price 60 00:03:11,053 --> 00:03:14,053 Speaker 3: that producers out of Indonesia can supply it, it's clearly 61 00:03:14,133 --> 00:03:16,333 Speaker 3: just quite competitive for them to get it off short. 62 00:03:17,053 --> 00:03:20,252 Speaker 4: Right, And you mentioned natural gas there. How does that 63 00:03:20,293 --> 00:03:25,653 Speaker 4: factor into this whole unstability in the power system in 64 00:03:25,693 --> 00:03:26,133 Speaker 4: New Zealand. 65 00:03:27,013 --> 00:03:29,053 Speaker 3: Yeah, so of the two fossil fuels that we've got, 66 00:03:29,173 --> 00:03:33,813 Speaker 3: and more ways than my natural gas has generally been preferable, 67 00:03:33,853 --> 00:03:36,613 Speaker 3: in part because people like to say less emissions intensive, 68 00:03:36,733 --> 00:03:39,693 Speaker 3: it's a transition fuel or whatever. It certainly seems to 69 00:03:39,733 --> 00:03:42,413 Speaker 3: be more palatable for some people than what coal does. 70 00:03:42,613 --> 00:03:45,173 Speaker 3: But if you go back to sort of twenty seventeen, 71 00:03:45,253 --> 00:03:48,973 Speaker 3: twenty eighteen, New Zealand was producing close to two hundred 72 00:03:49,213 --> 00:03:51,773 Speaker 3: pedadules of gas each, yeah, somewhere about one hundred and 73 00:03:51,813 --> 00:03:54,933 Speaker 3: eighty two, one hundred and ninety. Now as of this year, 74 00:03:54,973 --> 00:03:57,973 Speaker 3: we're down to producing one hundred and six peda duels. Now, 75 00:03:58,053 --> 00:03:59,853 Speaker 3: a pedagol is just a unit of energy. It works 76 00:03:59,853 --> 00:04:01,933 Speaker 3: out about twenty eight liters of petrol. But if you 77 00:04:02,013 --> 00:04:05,093 Speaker 3: just accept the fact that our gas production has pretty 78 00:04:05,173 --> 00:04:09,093 Speaker 3: much halved over the last seven years and over the 79 00:04:09,133 --> 00:04:11,293 Speaker 3: next five years, we're going to be down to about 80 00:04:11,493 --> 00:04:15,653 Speaker 3: sixty six petidule. So our gas production is down and 81 00:04:15,733 --> 00:04:19,013 Speaker 3: on a tradictory to continue falling. And so if you've 82 00:04:19,013 --> 00:04:21,613 Speaker 3: got a need for fossil fuels to firm up the grid, 83 00:04:21,893 --> 00:04:23,573 Speaker 3: coal is the most logical choice. 84 00:04:24,213 --> 00:04:28,133 Speaker 4: So as that as that gas production decreases, we're going 85 00:04:28,173 --> 00:04:30,693 Speaker 4: to have and increase in coal importing. 86 00:04:31,973 --> 00:04:34,413 Speaker 3: That would be my guests. Yes, I mean there has 87 00:04:34,413 --> 00:04:37,413 Speaker 3: been talk of liquefied natural gas imports into New Zealand. 88 00:04:37,413 --> 00:04:40,093 Speaker 3: How cost effective or likely that is, I'm not sure. 89 00:04:40,133 --> 00:04:42,373 Speaker 3: But in the meantime, I mean, coal is a pretty 90 00:04:42,973 --> 00:04:45,573 Speaker 3: simple fuel. You can use it and abuse it to 91 00:04:45,613 --> 00:04:48,253 Speaker 3: your hearts. Contend, you can cut it around on a truck, 92 00:04:48,293 --> 00:04:50,013 Speaker 3: you can leave it in the rain. It's you know, 93 00:04:50,053 --> 00:04:51,773 Speaker 3: you don't have to keep it in bottles like gas. 94 00:04:51,773 --> 00:04:54,573 Speaker 3: It's not like electricity that has to run down lines. 95 00:04:54,773 --> 00:04:59,093 Speaker 3: So yeah, it's a solid, transportable fuel that's easy to store, 96 00:04:59,213 --> 00:05:01,013 Speaker 3: just in a large pile of up to six hundred 97 00:05:01,013 --> 00:05:03,813 Speaker 3: thousand tons. Obviously, so as these electricity companies are concerned. 98 00:05:03,893 --> 00:05:06,053 Speaker 2: So are there policy hurdles that have been put in 99 00:05:06,133 --> 00:05:09,453 Speaker 2: the way of coal producers and mine companies or is 100 00:05:09,493 --> 00:05:11,973 Speaker 2: it more the facts that the market value that they 101 00:05:12,013 --> 00:05:14,453 Speaker 2: can get from opening up a new coal mine, just 102 00:05:14,493 --> 00:05:15,293 Speaker 2: as and what it used to be. 103 00:05:16,813 --> 00:05:18,733 Speaker 3: I would say it's definitely a bit of both. 104 00:05:18,773 --> 00:05:22,853 Speaker 6: I mean, I heard one of your callers say earlier. 105 00:05:23,293 --> 00:05:24,853 Speaker 6: Once in the good old days, all of these coal 106 00:05:24,853 --> 00:05:27,253 Speaker 6: mines were owned and operated by the state up to 107 00:05:27,253 --> 00:05:29,413 Speaker 6: a point where solid energy went broke under the government's 108 00:05:29,413 --> 00:05:31,453 Speaker 6: management and then had to be sold off for you know, 109 00:05:31,493 --> 00:05:34,253 Speaker 6: in its various parts. And so there were coal mines 110 00:05:34,293 --> 00:05:36,773 Speaker 6: running in the White Keatdow like Huntly Underground and the likes, 111 00:05:36,853 --> 00:05:40,413 Speaker 6: and as far as I can recall, when solid energy 112 00:05:40,453 --> 00:05:42,813 Speaker 6: was broken up into you know, it's parts and sold off, 113 00:05:43,493 --> 00:05:46,733 Speaker 6: there were about three or four coal mining companies that 114 00:05:47,173 --> 00:05:49,373 Speaker 6: bought what were going concerns, and then there were other 115 00:05:50,093 --> 00:05:52,733 Speaker 6: so called assets that were not taken on because presumably 116 00:05:52,773 --> 00:05:55,213 Speaker 6: they weren't viable, and I imagine that was the case 117 00:05:55,293 --> 00:05:58,733 Speaker 6: for hunt the Underground. But yeah, this, I mean, it's 118 00:05:58,733 --> 00:06:00,693 Speaker 6: hard to do anything in this country, as anyone who 119 00:06:00,693 --> 00:06:03,573 Speaker 6: ever tries to do anything knows, whether that's building a house, 120 00:06:03,653 --> 00:06:06,413 Speaker 6: whether that's trying to set up a hydro scheme on 121 00:06:06,453 --> 00:06:08,893 Speaker 6: the west coast of the South Island, and mining is 122 00:06:08,933 --> 00:06:11,533 Speaker 6: no exception. But I think all of those renewables are 123 00:06:11,613 --> 00:06:15,013 Speaker 6: under the same under the same constraints. You know, there 124 00:06:15,053 --> 00:06:17,013 Speaker 6: was an attempt to solar farm down in the mckenzy 125 00:06:17,053 --> 00:06:19,213 Speaker 6: country a year or two ago and that got stuck 126 00:06:19,213 --> 00:06:21,653 Speaker 6: in the consenting process as well. But yea, certainly there 127 00:06:21,653 --> 00:06:25,413 Speaker 6: are a lot of regulatory hurdles to more coal production 128 00:06:25,493 --> 00:06:28,613 Speaker 6: in this country than otherwise. Otherwise might be the case 129 00:06:28,693 --> 00:06:31,613 Speaker 6: because you know, a boggy paddock with a few tussics 130 00:06:31,613 --> 00:06:33,253 Speaker 6: growing and it can be considered a wetland and so 131 00:06:33,293 --> 00:06:34,693 Speaker 6: that can make it quite difficult if you want to 132 00:06:34,733 --> 00:06:37,013 Speaker 6: dig it up to get the coal that's underneath it. 133 00:06:37,613 --> 00:06:40,653 Speaker 6: So yeah, there's I'd say that there's a whole heap 134 00:06:40,653 --> 00:06:43,493 Speaker 6: of different factors at play, but coal production in this 135 00:06:43,493 --> 00:06:44,973 Speaker 6: country could be higher than otherwise. 136 00:06:44,973 --> 00:06:49,093 Speaker 4: As we're talking to Patrick Felts, Minerals West Coast Manager, 137 00:06:49,373 --> 00:06:51,013 Speaker 4: what do you say to people like the lady that 138 00:06:51,053 --> 00:06:54,493 Speaker 4: we've all just heard on the news was saying every 139 00:06:54,573 --> 00:06:57,573 Speaker 4: ton of coal that has burnt leads to the crazy 140 00:06:57,613 --> 00:07:01,493 Speaker 4: weather and events like the Canterbury wildfires that we're experiencing. 141 00:07:03,493 --> 00:07:08,013 Speaker 3: Yeah, I mean every unit of fossil into the atmosphere, 142 00:07:08,413 --> 00:07:11,693 Speaker 3: if we're measured in tons of carbon dioxide and contributes 143 00:07:11,733 --> 00:07:15,773 Speaker 3: to climate change cold no exception. Nor are our diesel 144 00:07:15,813 --> 00:07:20,493 Speaker 3: and petrol petrol that we use for transport, more of 145 00:07:20,493 --> 00:07:23,333 Speaker 3: the jet engines that bring into national travelers here. I mean, 146 00:07:23,853 --> 00:07:26,693 Speaker 3: I think it's still upwards of eighty or ninety percent 147 00:07:26,733 --> 00:07:29,173 Speaker 3: of all of the world's energy comes from fossil fuel, 148 00:07:29,253 --> 00:07:33,253 Speaker 3: the balance coming from renewables and nuclear. So yeah, coal 149 00:07:33,293 --> 00:07:35,013 Speaker 3: makes a contribution. But what I would say to that 150 00:07:35,093 --> 00:07:37,093 Speaker 3: as well is that in New Zealand, of all of 151 00:07:37,093 --> 00:07:42,973 Speaker 3: our fossil fuels, oil, transport, gas and coal, because we 152 00:07:42,973 --> 00:07:44,413 Speaker 3: don't use as much of that as we use of 153 00:07:44,453 --> 00:07:49,133 Speaker 3: other fuels, it's the minority of our carbon dioxide emissions. 154 00:07:49,173 --> 00:07:54,573 Speaker 3: But ultimately Genesis is using coal. They have revenue, they 155 00:07:54,613 --> 00:07:56,573 Speaker 3: have got the ability to borrow money. If they thought 156 00:07:56,573 --> 00:07:58,013 Speaker 3: the best bet was to just go and build the 157 00:07:58,013 --> 00:07:59,733 Speaker 3: Holy p solar farms, or go and build the whole 158 00:07:59,773 --> 00:08:02,213 Speaker 3: Yaper wind farms, that's what they'd be doing. There's clearly 159 00:08:02,213 --> 00:08:04,573 Speaker 3: a demand in the market to keep a fossil fuel 160 00:08:04,613 --> 00:08:08,853 Speaker 3: plant going in our electricity generation folio. 161 00:08:09,653 --> 00:08:11,973 Speaker 4: So what would you like to see happen, you know, 162 00:08:12,093 --> 00:08:15,293 Speaker 4: in the short, medium and long term in terms of 163 00:08:16,413 --> 00:08:20,453 Speaker 4: coal usage and New Zealand and just power generation in 164 00:08:20,453 --> 00:08:21,733 Speaker 4: New Zealand in general. 165 00:08:22,213 --> 00:08:23,973 Speaker 3: I'd get rid of all of the other energy sources 166 00:08:23,973 --> 00:08:25,973 Speaker 3: and just use coal for everything. Go back to steam train. 167 00:08:26,093 --> 00:08:29,013 Speaker 3: Steams were what a time. 168 00:08:31,933 --> 00:08:33,493 Speaker 4: Growing up in Toned and I do miss the smell 169 00:08:33,533 --> 00:08:34,652 Speaker 4: of papagas. 170 00:08:35,813 --> 00:08:36,013 Speaker 6: No. 171 00:08:36,133 --> 00:08:38,413 Speaker 3: I was just going to say that the I think 172 00:08:38,413 --> 00:08:39,813 Speaker 3: in the name, we've got to make it easy to 173 00:08:39,813 --> 00:08:41,333 Speaker 3: do a lot of things in you deal in, including 174 00:08:41,372 --> 00:08:44,293 Speaker 3: electricity generation I still have on the West coast has 175 00:08:44,333 --> 00:08:46,573 Speaker 3: borne and raised here and in my lifetime I've seen 176 00:08:46,573 --> 00:08:51,132 Speaker 3: two attempts at reasonably large hydro projects. Would have you know, 177 00:08:51,333 --> 00:08:52,852 Speaker 3: they wouldn't have gone rid of all fossil fuels, but 178 00:08:52,852 --> 00:08:54,852 Speaker 3: they would have shifted the needle in terms of our supply. 179 00:08:55,333 --> 00:08:57,093 Speaker 3: They've both got held up in that process, and the 180 00:08:57,093 --> 00:08:59,973 Speaker 3: same is true for pretty much every other renewable asset 181 00:09:00,012 --> 00:09:02,453 Speaker 3: that you could attempt to build. So I think making 182 00:09:02,453 --> 00:09:06,492 Speaker 3: it easy to do everything is quite important. I think 183 00:09:07,053 --> 00:09:09,693 Speaker 3: repealing the oil and gas and was I think quite 184 00:09:09,693 --> 00:09:12,012 Speaker 3: a good move because it gives us more options. But 185 00:09:12,132 --> 00:09:13,933 Speaker 3: if there's more gas out there, it's going to take 186 00:09:13,933 --> 00:09:17,213 Speaker 3: a while to be found and come online. In the meantime, 187 00:09:17,333 --> 00:09:19,893 Speaker 3: must think making it easier to produce coal in this country, 188 00:09:19,933 --> 00:09:22,053 Speaker 3: but still just being willing to live with the fact that, 189 00:09:22,653 --> 00:09:24,733 Speaker 3: just like anything else we can't produce enough of or 190 00:09:24,773 --> 00:09:27,333 Speaker 3: produce cheaply enough in New Zealand, we're probably going to 191 00:09:27,372 --> 00:09:30,413 Speaker 3: have to live with important bear in mind we export 192 00:09:30,413 --> 00:09:32,333 Speaker 3: goods all over the world. We import things we don't need. 193 00:09:32,372 --> 00:09:34,493 Speaker 3: We live, we live in a global economy, and I 194 00:09:34,492 --> 00:09:37,173 Speaker 3: think that that's a good thing. We've actually, funnily enoughve 195 00:09:37,173 --> 00:09:40,413 Speaker 3: got a trade surplus with Indonesia because they can send 196 00:09:40,453 --> 00:09:41,853 Speaker 3: a lot of our meat and dairy products which are 197 00:09:41,892 --> 00:09:46,373 Speaker 3: produced with coal in a slightly conflated way. And I 198 00:09:46,413 --> 00:09:49,013 Speaker 3: do think it's some stage New Zealand. Look, maybe not today, 199 00:09:49,093 --> 00:09:51,493 Speaker 3: maybe not tomorrow, but I do think it's some stage 200 00:09:52,173 --> 00:09:54,613 Speaker 3: being open minded to some form of nuclear generation in 201 00:09:54,612 --> 00:09:56,653 Speaker 3: New Zealand. It's something that I think people should consider 202 00:09:56,892 --> 00:09:59,733 Speaker 3: because after hydro, it's the world's largest source of lower 203 00:09:59,773 --> 00:10:00,492 Speaker 3: mission's energy. 204 00:10:01,173 --> 00:10:03,093 Speaker 4: All right, so let's get some nuclear power going. Let's 205 00:10:03,093 --> 00:10:05,453 Speaker 4: find a rivet advand basically yeah, pretty. 206 00:10:05,293 --> 00:10:07,413 Speaker 3: Much, yeah, and just steam trains and steamships. I think 207 00:10:07,413 --> 00:10:08,012 Speaker 3: if you didn't. 208 00:10:07,813 --> 00:10:11,693 Speaker 2: Mis sell us lover, Patrick, really good to catch up. 209 00:10:11,973 --> 00:10:13,533 Speaker 2: Go well and we'll talk again soon. 210 00:10:13,612 --> 00:10:15,773 Speaker 4: Bring back the traction engines on our farms. 211 00:10:16,732 --> 00:10:20,133 Speaker 2: That is Patrick Phelps, the manager of Mineral's WIST coach. 212 00:10:20,492 --> 00:10:23,172 Speaker 1: For more from News Talk set B listen live on 213 00:10:23,252 --> 00:10:26,213 Speaker 1: air or online and keep our shows with you wherever 214 00:10:26,252 --> 00:10:28,813 Speaker 1: you go. With our podcasts on iHeartRadio.