New Zealand and renewable energy
New Zealand is a nation increasingly focused on renewable energy, driven by its commitment to sustainability and a growing recognition of the need to reduce reliance on fossil fuels. Historically, New Zealand's first inhabitants and European settlers utilized natural resources like wood, water, and geothermal energy for heating and transportation. Despite this rich heritage, by the early twenty-first century, fossil fuels supplied about two-thirds of the country's energy needs. However, significant strides have been made in renewable energy development, particularly in electricity generation, where hydropower now accounts for over 69 percent of total generation as of 2022.
Geothermal energy, utilized since the 1980s, is also a vital part of New Zealand's energy mix, alongside emerging technologies like biomass and solar power. The government has set ambitious targets, including a goal of achieving 100 percent renewable electricity by 2030. As the country navigates its energy challenges, it continues to balance the use of traditional energy sources with innovations in sustainability, reflecting an ongoing commitment to environmental stewardship while addressing the needs of its diverse population.
New Zealand and renewable energy
Official Name: New Zealand.
Summary: Although New Zealand still relies considerably on fossil fuel energy, it has significantly grown its renewable energy sources as it aims for greater sustainability.
Energy sources used by the first inhabitants of New Zealand included wind for sailing, muscular power for transportation and agriculture, and wood and geothermal springs for cooking and warmth. When Europeans arrived by sail in the early 1800s, they employed domesticated animals for labor and transport. Wood burning provided energy for home heating and for industry. Later, the power of water was employed for the movement of timber and for gold excavation. With the coming of the Industrial Revolution, New Zealand turned increasingly to thermal energy sources. By the early twenty-first century, about two-thirds of the nation’s energy needs were supplied by fossil fuels, with imports exceeding domestic production. However, New Zealand became a leader in developing renewable energy resources, particularly in electricity generation, with over 70 percent of electric capacity coming from hydropower or other renewables by 2012 (the figure reached 85.9 percent in 2022). Overall, energy consumption in the country is dominated by industry and transportation and continues to grow. Additional energy demand comes from commercial, residential, and public services, as well as from agriculture, forestry, and fishing.
Electricity
All of the nation’s power stations are connected to the electrical grid, and 100 percent of the population receives electricity. The majority of New Zealand's electricity is derived from renewable resources, primarily hydroelectric (69.2 percent of total generation, according to 2022 estimates). The Rio Tinto Aluminum Smelter at Tiwai Point is the country's single largest consumer of electricity, using around 10 to 15 percent of the national total. According to the World Bank, New Zealand had an average per capita energy consumption of 7,882 kilowatt-hours in 2024.
Oil Wells
The first oil well in New Zealand was drilled in 1866 in the Taranaki Basin. With the introduction of automobiles in the 1920s, gasoline began to be imported. In 1964, the Marsden Point refinery began processing crude oil imported from the Middle East, Australia, Malaysia, and Indonesia in order to bolster the supply of transportation fuels. The Marsden plant is the country's only oil refinery. However, as New Zealand’s domestic crude oil is not suitable for refining at Marsden Point, most of it gets exported for processing. Price controls were removed in the late 1980s, when the oil sector was deregulated. Crude oil reserves were estimated at 59 million barrels in 2022. Major oil companies in New Zealand include BP (British Petroleum), Chevron, Shell, and Mobil. Concerns for the future of oil are exacerbated by New Zealand’s isolated geographical location, which makes it difficult to attract international exploration, and the possibility of future oil shocks that could hurt the multibillion dollar tourist industry that depends on affordable fuel for transportation.
Coal and Thermal Fuel
Coal has been used as a thermal fuel ever since the 1860s, when it overtook wood for industrial and home use. Around 1900, coal gas also came into use for lighting. Nearly all of New Zealand’s coal production is either subbituminous or of the higher-quality bituminous kind, which is exported for use in steelmaking. When natural gas production began to fall in the 1980s, the state-owned Huntly power plant (with a capacity of 1,000 megawatts electric) switched to using 80 percent coal. Southland and Otago hold a vast reserve of valuable lignite that remains largely untapped. One hurdle to the economic marketing of lignite, however, is the long distance to markets. Coal production declined steadily in the 2010s. The year 2021 marked the first time on record that New Zealand became a net importer of coal.
Natural Gas
The majority of natural gas in New Zealand is used for electricity generation, petrochemical production, and industry. The gas supply comes from fields in the Taranaki region that are operated primarily by Shell and Todd Energy. The vast Maui field was discovered in 1969, but its output is now in decline; newer sources include fields at Pokohura and Kupe. Spurred by the global oil shocks of 1973 and 1979, a synthetic fuel plant was built to make use of domestic natural gas; other large projects synthesize ammonia, urea, and methanol from gas. As with other fossil fuels, gas use for electricity generation fell in the 2010s, though the natural gas industry overall experienced significant growth.
Hydroelectric Power and Biomass
In New Zealand, hydroelectric power on a large scale was introduced in 1888, and the industry was expanded in the 1920s. Hydroelectric plants are located at the Waitaki and Clutha Rivers on the South Island and on the Waitako River and in the Taupo region of the North Island. Measures had to be taken to reduce electricity use when New Zealand experienced severe droughts in 1992, 2001, and again in 2003. New Zealand’s Electricity Commission has been set up to manage the nation’s energy security. The availability of hydropower is a large factor in why New Zealand ranked among the top five OECD countries in renewable primary energy supply in the 2010s. Although hydropower remained an important source of energy in New Zealand, dry conditions in 2021 led to a reduced output of hydropower for the year.
Wood and other biomass sources provide energy for home and industrial heating. Another biomass source is methane from landfills, which is used for electricity generation as well as for liquid fuel manufacturing. Other bio-based fuels include ethanol from whey and biodiesel from tallow. Waste-to-energy plants also convert municipal solid waste into industrially useful process heat and power.
Geothermal Facilities and Other Renewables
New Zealand has many years of experience with small-scale geothermal facilities. Some geothermal power goes directly to industry, and the remainder is used for electricity generation. Geothermal installations with outputs ranging from 100 to 250 megawatts-electric include the Kawerau and Nga Awa Purua stations; additional capacity use is planned for Tauhara Stage Two and the Te Mihi and Ngatamariki stations. New Zealand is one of the few countries that does not employ nuclear energy to generate electricity. Although in 1968 a national energy agenda projected a future need for nuclear energy, plans for four reactors were set aside when new fossil fuel sources were discovered. With more than 9,000 miles of coastline, New Zealand could also make use of power from the ocean in the form of waves, tides, and currents.
In some areas, photovoltaic (PV) devices are used for the conversion of sunlight into electricity. The use of wind as a renewable energy source has expanded rapidly; however, wind farm installations have faced some public opposition on aesthetic grounds. The Electricity Commission has also expressed concern about the intermittency of wind and its possible destabilization of the electric power grid.
New Zealand is a signatory of the Kyoto Protocol and Paris Agreement, and several national advisory agencies have been established to monitor the state of the environment. As New Zealand looks toward sustainable development, the country set a national goal of 100 percent renewable electricity by 2030.
Bibliography
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"New Zealand." CIA World Factbook, 30 July 2024, www.cia.gov/the-world-factbook/countries/new-zealand/. Accessed 7 Aug. 2024.
"New Zealand." International Energy Agency, 2024, www.iea.org/countries/new-zealand. Accessed 7 Aug. 2024.
"New Zealand." The World Bank, data.worldbank.org/country/new-zealand. Accessed 7 Aug. 2024.
Smith, Clint. “The Next Oil Shock?” Parliamentary Research Paper, October 2010. www.parliament.nz/en-NZ/ParlSupport/ResearchPapers/4/6/a/00PLEco10041-The-next-oil-shock.htm.
"Towards a Productive, Sustainable and Inclusive Economy: Aotearoa New Zealand's First Emissions Reduction Plan." Ministry for the Environment, New Zealand Government, 16 May 2022, environment.govt.nz/publications/aotearoa-new-zealands-first-emissions-reduction-plan/. Accessed 31 Jan. 2023.