ICCC report calls for overhaul of resource management system

Sunday, 28 July 2019, 1:25 pm
Article: NZ Energy and Environment Business Week

ICCC report calls for overhaul of resource management system

First published in Energy and Environment on July 18, 2019.

The Interim Climate Change Committee report calls for an overhaul of the Resource Management Act and its associated regulatory regime to enable the building of renewable generation.

It highlights political, policy and regulatory issues which are hindering increasing renewable energy and potentially restricting and reducing current generation.

The committee acknowledges some of the trade-offs and balancing needed when weighing up climate change policy with other issues such as the environment and water rights, but says if emissions reductions are a priority something must change.

The ICCC said hydropower is vital to the electricity system. “However, pressures are mounting to improve water quality, allocate water across competing users, and restore ‘over-allocated’ water bodies.”

Iwi/Māori and others consider the existing regulatory regimes give preference to hydro at the expense of ecological or cultural values and want higher minimum flows to improve the health of waterways.

“This could however adversely affect storage and system flexibility, as well as reduce the total capacity of hydro generation,” the report said.

Previous work has identified this increasing power prices and increasing emissions, and this could happen if conflicts between National Policy Statements were not resolved and if Iwi/Māori proprietary rights and interests in freshwater were recognised over the needs of the electricity system.

Importantly for hydro generation, there is an unresolved conflict between the National Policy Statement for Renewable Electricity Generation, and the National Policy Statement for Freshwater Management. The NPS-REG seeks to promote the benefits of renewable generation and maintain generation, but also says it does not apply to the allocation and prioritisation of freshwater

National guidance on water allocation is in the NPS-FM which says hydro generation is one of several national values to be considered when setting limits on water use.

The NPS-FM has an appendix where existing nationally-important infrastructure can be listed, allowing decision-makers to trade-off national values. This could provide flexibility to set less constrictive limits on minimum flows than otherwise would be allowable under the national bottom lines.

“However, this list is currently empty, so bottom lines will need to be met everywhere, even where this could have a major impact on a nationally-significant hydro scheme. This particular policy uncertainty is untenable.”

The two largest hydro schemes will require renewal of water permits within the next 15 years, and are likely to have to compete for water use, but the regulatory framework means the outcome of this process is uncertain.

ICCC modelling suggests wind will be the dominant form of new renewable generation out to 2035. There is currently 700 MW of wind in the system, and about 2,000 MW of wind is currently consented yet unbuilt due to flat electricity demand. A key assumption of the modelling is new wind generation could be built easily as needed. However, there are several barriers hindering this.

One important issue is to do with recent legal judgments interpreting the RMA’s use of the term ‘avoid’ in planning documents. As a result of judgements, the Supreme Court considers that section 6(b) of the RMA means “adverse effects are not to be avoided, remedied or mitigated, but simply avoided”.

This is of relevance to wind (and transmission infrastructure) because their visual effects are impossible to avoid by nature.

Many existing consents also needed upgrading due to technological advances and the ICCC said the consenting (and re-consenting) processes should be streamlined.

“Given the national imperative of emissions reductions, the ability to decline applications for wind generation due to landscape or visual considerations should be significantly constrained. Further, there is a strong case for resource management processes proactively enabling wind farms and their connecting network, rather than identifying where they are not allowed”.

Changes also needed to go further to enable renewable generation with a specific National Environmental Standard unless there was a “significant” environmental impact.

The Committee also said coming RMA reform was a major opportunity to not just remove barriers to emissions reductions, but to actively support mitigation.

First published in Energy and Environment on July 18, 2019.

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