The New Zealand Green Building Council (NZGBC) has sharply criticised the government’s recently announced plan to import Liquefied Natural Gas (LNG), arguing that a nationwide rollout of solar power and hot water heat pumps would be a more cost-effective and resilient solution to the country’s energy challenges.
The criticism comes after Climate Change Minister Simon Watts unveiled the LNG plan this week, citing a declining domestic gas supply and the require to avoid increased reliance on coal and diesel during periods of low hydro lake levels. Watts stated the plan was designed to address recent electricity price spikes impacting both businesses and households. “New Zealand is experiencing a renewable electricity boom, but a rapidly declining gas supply has left our electricity sector exposed during dry years, when our hydro lakes run low,” Watts said.
However, Andrew Eagles, chief executive of the NZGBC, contends that the LNG plan represents a step backwards, favouring outdated infrastructure over modern technology. The NZGBC released a report on Q+A, a television news program, outlining an alternative approach focused on incentivising solar and heat pump adoption in new builds. Eagles claims this strategy could save Kiwi households approximately $6 billion over 15 years.
“We were really interested to see what we could do with modern new technology like solar and hot water heat pumps,” Eagles said in an interview on Q+A. He further argued that the LNG terminal would create a “single point of failure” and expose New Zealand to volatile international energy markets, mirroring the price shocks experienced globally following Russia’s invasion of Ukraine.
According to the NZGBC, their proposed plan, estimated to cost $2.5 billion initially, would deliver long-term savings, contrasting with the LNG plan’s lower upfront costs but ongoing expenses for terminal maintenance and fuel procurement. Eagles detailed the NZGBC’s findings on LinkedIn, stating that solar and heat pumps are 60% cheaper than the proposed LNG facility in generating the same amount of energy.
Eagles challenged the government’s assertion that LNG would stabilise electricity prices. “When we hook up to an international energy price, what other countries have seen is that it dramatically increases those energy prices due to the fact that you’re competing with a global market,” he stated. He also pointed to Cabinet papers suggesting increased reliance on LNG from 2028-2029 as domestic gas reserves dwindle, despite the availability of alternative solutions.
The government, however, maintains that LNG was selected after careful consideration of various options, including renewable projects. Officials cited concerns regarding the construction timelines, reliability, and market incentives associated with those alternatives. “LNG was the preferred option after consideration and analysis of the options. LNG was found to lower electricity prices at relatively low capital cost and deliver spillover benefits,” a government statement indicated.
The New Zealand Green Building Council was established in 2005 and receives support from engineers, architects, and builders within the country.
