Hon David Parker
Minister of Energy
Minister responsible for Climate Change issues

7 November 2006

Speech notes

Racing to improve vehicle fuel economy
Address to the AA EnergyWise Rally Luncheon
12pm, Grand Hall, Parliament Buildings
Wellington

As the Minister of Energy and Minister Responsible for Climate Change Issues it is my pleasure to be here today to join with you in celebrating the 2006 AA EnergyWise Rally.

The Rally is the most public event held in New Zealand that promotes fuel economy, and given the recent high prices at the petrol pump I’m sure the public will be very interested in this year’s results.

I would like to extend my thanks to Automobile Association, the Energy Efficiency and Conservation Authority, and to Gull for running this event again this year, and to all the vehicle manufacturers who have stepped up to the plate for this level of scrutiny and public competition.

As Harry Duynhoven has suggested there are a number of related government initiatives underway that we believe will improve the fuel economy of the country's vehicle fleet, reduce the emissions that contribute to climate change and pollution, and put us on the path to a more sustainable transport future.

A report I released a few months ago, the Energy Outlook to 2030, projects that if we do not change our policy settings, greenhouse gas emissions from transport will increase by 35 percent over the next 25 years. We cannot - and will not - let that happen.

The measures the government is currently considering to address this make good sense for the environment, but also for our back pocket, because they mean New Zealanders will save money on fuel.

Vehicle use is one of the major contributors to New Zealand’s greenhouse gas emissions. Vehicle emissions also have a detrimental effect on air quality, urban amenity and human health. It is therefore critical that we begin to reduce these emissions, and improving the fuel efficiency of the vehicle fleet as well as introducing the use biofuels are two ways we can do this.

Two government initiatives that I would like to briefly speak about today relate closely to the AA EnergyWise Rally event. They are firstly, the biofuels sales obligation and secondly, mandatory fuel efficiency labelling of vehicles at point of sale.

In terms of the environment, transport is responsible for close to 20 percent of New Zealand's annual greenhouse gas emissions, and vehicles also contribute to air quality concerns. Increasing oil prices have also highlighted the need to reduce our dependence on imported oil.

The Government is now working towards the introduction of renewable transport fuels to the market - including ethanol petrol blends and biodiesel diesel blends.

The government is developing a ‘biofuels sales obligation’, for the sale and use of biofuels and biofuel blends in New Zealand. The aim is to ensure that oil companies selling petrol or diesel must also sell biofuels. A discussion document was released in September and we are now considering the submissions that have been made, no doubt by some of you here today.

As the use of biofuels increases, we’ll be sending strong signals supporting the import of biofuels compatible vehicles. It is great to see the demonstration biofuels cars entered in the rally this year, in particular the Ford Focus, which is running on E85, or an 85% ethanol–petrol blend, and is being driven by the EECA team. In future we would like to see all vehicles in the rally running on biofuels.

I'm delighted to be able to take the opportunity today to launch another government transport proposal - mandatory vehicle fuel efficiency labelling.

At today’s luncheon, we are releasing a discussion document so you will be the first to see it and you are welcome to take away a printed copy on your way out.

The purpose of fuel economy information is to provide consumers with information at point of sale, so they can compare the fuel consumption of the cars they are considering buying.

This will enable them to make more informed purchase decisions and thereby increase the uptake of more fuel-efficient vehicles, resulting in reduced fuel costs for motorists.

Improved fuel economy also offers important co-benefits, particularly reducing greenhouse gas and harmful tailpipe emissions, and improving energy security.

Improving fuel economy will not, by itself, solve all of these problems, but as part of the wider suite of initiatives we're working on, it can make an important contribution.

I strongly encourage all interested parties to comment on the proposals in this document, and help us develop a new vehicle fuel economy labelling scheme for New Zealand.

Congratulations again to those involved in organising this event for bringing the important issue of fuel economy into the public arena again through the AA EnergyWise Rally, and thank you for your time today.

And for those of you who are continuing to Auckland with the rally I wish you all the best on the remaining part of your energy efficient journey to Auckland and may the best car and driver win.

ENDS

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