Government plans to double geothermal energy produced for electricity and heating

4 days ago

Resources Minister Shane Jones.
Photo:
RNZ / Samuel Rillstone
The government has released a draft plan to double the amount of geothermal energy produced for electricity and heating within 15 years.
Resources Minister Shane Jones said the draft strategy would unlock New Zealand's geothermal potential, extend New Zealand's position as a world leader in geothermal innovation and strengthen regional economies and the Māori economy.
"I see potential for our geothermal sector to expand and diversify into areas such as the extraction of minerals from geothermal fluid, the development of globally sought-after innovation and science, and more use of direct geothermal energy to power industrial, commercial and agricultural applications," he said.
According to the Ministry for Business, Innovation and Employment (MBIE), New Zealand's first, and the world's second, geothermal power station was Wairakei͕, which opened in 1958 and in 2024 geothermal fields generated almost 20 percent of the country's electricity.
Contact Energy's Tauhara geothermal power station opened in late 2024.
Geothermal heat is also used for industrial processes including drying timber and manufacturing tissues.
Upfront costs for drilling new wells have been put at $10-15 million per well.
The draft strategy said much of the current infrastructure was built on exploration by the Crown decades ago, and there needs to be more coordination between scientists, government, industry and tangata whenua.
Among the proposals are "recalibrating" planning laws to be more enabling and adaptive, using government-private partnerships to fund feasibility and demonstration projects, commissioning new research and making data on geothermal resources publicly available.
The draft plan also proposes reviewing the Emission Trading Scheme settings to see if they are limiting the uptake of geothermal heat.
Also on the list are exploring a new Geothermal Centre of Excellence, looking at tourism opportunities in Taupō and Tarawera in partnership with iwi, and considering the need for Crown involvement in exploration or modelling.
The draft timeline points to possible Crown-backed exploration starting from 2029.
No funding has yet been attached to the proposals.
The country's electricity demand is expected to rise by 68 percent over the next 25 years.
Geothermal power can be used to underpin rapid growth in solar and wind generation, as the government aims for its goal of doubling the supply of renewable energy.
Like hydro power, geothermal energy can provide a low-carbon and consistent source of electricity when the sun and wind aren't generating enough supply.
But unlike hydro, the government sees big potential for geothermal to grow - and it doesn't rely on rainfall levels.
The government has previously ring-fenced $60 million from the Regional Infrastructure Fund to explore for
supercritical geothermal resources
, extra-hot fluids below 5km deep.
The government said $5 million of that funding has been drawn down for work on the detailed design and cost to drill the first of three exploratory deep wells in the Taupō Volcanic Zone.
The strategy is open for submissions until 12 September.

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The NZ economy is still sick, doubts are growing about the Govt prescription

NZ Herald

3 hours ago

NZ Herald

The NZ economy is still sick, doubts are growing about the Govt prescription

Are these the right antibiotics? Are the antibiotics making me feel sick? I do feel a little better I think. But it's taking longer than I expected. Maybe I should see the doctor again. Or am I just being impatient? Ugh, so much uncertainty. Hopefully, those who've tuned in for a fresh read on the state of the economy can see where this is going. Never let a metaphor go by, I say! Anyway, here's me and the New Zealand economy, both sick in the midst of a miserable wet winter and worrying about whether our recoveries have stalled. A run of negative data has knocked the wind out of the nation's sails. The bad vibes are being pushed along by a strong political current. Both the left and right are telling us that the Government has prescribed the wrong medicine. The left blames the Government for cutting spending into a downturn. The logic is pretty simple. Any good Keynesian will tell you, when demand in the private sector falls, that's the time for the Government to come to the party. Borrow a bit more, don't slash and burn civil service, hire more teachers and nurses, build more stuff ... it won't be inflationary because it won't be crowding out private sector competition, which is in recession. The trouble is, we're still in the aftermath of the last big spend-up, which went on too long. Labour's stimulus, once we got through the initial Covid shock, did clash with a private sector boom and exacerbated inflation. That muddied the political narrative. It made it inevitable that the incoming centre-right coalition would cut back despite the extra damage that would do to economic growth. In the context of using fiscal policy to drive economic prosperity, you can make a good case that successive governments have got things completely arse about face. You'd expect this argument from the left. But Christopher Luxon and Nicola Willis are being savaged even more aggressively from their right flank. The monetarists, the supply-side guys, the neo-liberals, (whatever you want to call them) are berating the Government for not dealing with the national debt and Crown deficit by administering a Rogernomics-style reboot of the whole economy. I doubt that would make the current downturn any more pleasant, but they argue it couldn't be much worse. And the payoff would be longer-term gains as the economy found a more productive and financially secure baseline. Both arguments can be compelling and, if nothing else, add to the concern that the current strategy of subtle market-oriented tweaks risks underdelivering on all sides. But through all of this gloom, one thing we need to remember is that most economists still believe the foundations of recovery are in place. Step back a bit from the mess of ugly recent economic data – the second quarter sucked, we get it! What are we actually experiencing? The labour market is tough. Unemployment is rising, and new job creation is almost non-existent. But this is not a surprise. In fact, while economists do get things wrong, they've been forecasting unemployment to be about where it is now for more than a year. We know it's one of the last pieces of data to turn in any recovery. Unfortunately, it is now overlapping with an unwanted and unexpected spike in inflation. Like a jump scare in the final scene of a horror movie, food prices (with rates and power, and insurance) have conspired to pause Reserve Bank rate cuts and rattled our faith in the recovery. Then there are tariffs and global unrest and all of that. It's not really surprising that it all feels bleak. So it's a bit ironic to be writing an optimistic take on the economy, especially given the rough week stuck at home that I've just had. My view wouldn't have been so upbeat if I hadn't been woken from my sick bed on Friday morning by a text from investment bank HSBC's Australian head of communications. He was asking how far away I was from my scheduled meeting with their global chief economist, Janet Henry and and Australia-New Zealand chief economist Paul Bloxham. Oops ... I was a long way away. But they kindly let me Zoom in later, and I'm very glad I did. As anyone with Australian cousins will know, sometimes it's healthy to be slapped in the face with a slightly condescending, external view of the New Zealand condition. Bloxham told me his forecasts currently make him one of the gloomiest economists on Australian growth. However, he's one of the most positive on New Zealand growth. Last year, New Zealand had the single largest contraction of any economy in the developed world, Bloxham points out. That inevitably comes with a hangover. But if you believe in the fundamentals of the New Zealand economy, which he does, there is no reason to assume the cycle won't turn. 'I suspect why I'm a little bit more upbeat than others is I sit in Sydney and watch it from the outside and go: hey, you've got two big forces at work that are set to continue to lift growth and give you a recovery.' No prizes for guessing those two forces – falling interest rates and booming agricultural commodity prices. The money flowing into the rural economy must eventually flow through to the cities and lift growth, Bloxham says. It won't happen overnight, but it will happen (my words, not his). We've had a big downswing, which means we're due a pretty big upswing to get back to trend, he says. And we've got monetary policy and the terms of trade in place to drive that cyclical upswing. 'All cycles look different. We always ask the same question going through: oh, it's not quite happening as quickly as we thought. 'The question you ask yourself is: is that because it's not working? Is it that interest rates aren't going to have the same effect? That a positive-terms-of-trade shock won't have the same effect? Or are things just a bit different this time around?' Great question. And look, the sun's finally out and I think my head's clearing. Time to go for a walk and ponder it all. Liam Dann is business editor-at-large for the New Zealand Herald. He is a senior writer and columnist, and also presents and produces videos and podcasts. He joined the Herald in 2003.

Foreign tourists to be charged entry fee at key NZ sites

Otago Daily Times

18 hours ago

Otago Daily Times

Foreign tourists to be charged entry fee at key NZ sites

Prime Minister Christopher Luxon. Photo: RNZ The government has announced plans to "unleash growth" on conservation land, granting more business opportunities and introducing entry fees for international visitors at four popular sites. Prime Minister Christopher Luxon and Conservation Minister Tama Potaka announced changes to the Conservation Act at the National Party Conference in Christchurch on Saturday. Those changes would create more concessions - permission to operate a business - in tourism, agriculture and infrastructure. Many businesses already ran on the conservation estate, including guided walks and skifields, filming documentaries, grazing sheep and cattle, hosting concerts and building cellphone towers, but Luxon said the concessions regime was "totally broken, often taking years to obtain or renew, and leaving businesses in a cycle of bureaucratic limbo". International visitors will be charged between $20 to $40 to access four popular sites, including the Milford Track. Photo: Getty He said the rules were outdated and the system would be changed to allow more jobs, growth and higher wages, with a "fresh wave" of new concessions made available. Another change would see international visitors charged between $20 to $40 to access four popular sites - Cathedral Cove, the Tongariro Crossing, Milford Track and Aoraki Mount Cook. The government estimated it would bring in $62 million a year in revenue to be re-invested in those same areas, Potaka said. New Zealanders would not be charged, with Luxon saying: "It's our collective inheritance and Kiwis shouldn't have to pay to see it."

Foreign tourists to pay to visit key NZ sites