Government to build $27m clean energy centre in Taranaki, $20m research fund

Thursday, 9 May 2019

A new $27 million clean energy centre will be built in Taranaki by the Government, and another $20 million will go into research, the Prime Minister has announced.

Jacinda Ardern made the announcement during her opening speech at the Just Transition Summit in New Plymouth on Thursday.

Where the $27m centre will be built is up in the air but the $20m, to be dished out over four years, will fund research into cutting edge energy technology, so the country can look into organic photovoltaics, super conductors, nanotechnologies and inductive power.

'The National New Energy Development Centre (NNEDC) will help create new business and jobs in Taranaki while helping New Zealand move towards clean, affordable, renewable energy and away from fossil fuels,' Ardern said.

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Prime Minister Jacinda Ardern announced $27m investment into a clean energy centre in Taranaki and $20m for a research fund at the Just Transition Summit in New Plymouth on Thursday.

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The new centre will look at the full range of emerging clean energy options such as offshore wind, solar batteries, hydrogen and new forms of energy storage.

Thursday's announcement follows the decision in April last year that the Government would not issue any new offshore oil and gas exploration permits, and no new onshore permits outside of Taranaki.

'For decades, Taranaki has been our top energy-producing region and now, in the twenty-first century, the region can be a leader in clean energy as well,' Ardern said.

'It's well known that local businesses and workers already have the skills, experience and international links to support new developments in clean energy technology and infrastructure.'

In her speech, Ardern paid tribute to mayor Neil Holdom for his advocacy on Taranaki's role in developing clean energy.

New Plymouth Mayor Neil Holdom has given Ardern credit for 'turning up' with her A-team and her chequebook. (File photo)

Ardern said she had seen first-hand, while living in Murupara, the jarring effects of sudden change - families displaced and businesses closing.

'I've also seen what happens when we don't handle change well,' she said.

The Government wanted to make sure the country was prepared for the transition and the future was protected, and no one was left behind in the transition, she said.

A Westpac report estimated that if NZ got the transition right, there were opportunities that could generate up to $3 billion of benefits, she said.

Ardern also said the Government saw a role for gas in the transition, and 'for decades to come'.

There was excitement locally in Taranaki about the centre, Ardern said.

'It's part of their plan for the future. This is about us making sure we support them.'

Holdom said it was a good start and there had never been this level of Government presence in Taranaki.

'The Prime Minister has turned up; she's brought her A-team; she's brought her chequebook. She's made some commitments to our region and to the people here.'

Holdom said there had been a team of four working together on this issue for a united regional approach.

It was about aligning the job that the region had to do - looking after their community - with the Government's job of looking after the nation, he said.

When asked if $27 million was enough, he said:'Our goal is to find more opportunities to invest. There will be a return of that $27 million. It will generate commercial opportunities, it will create jobs, and it will flow back.'

However, more would be needed down the track, he said.

New Plymouth district councillor Stacey Hitchcock, who has done a lot of research into energy alternatives for Taranaki, said the announcement was great news.

'It's the spark of action that we needed,' she said.

'What this does is put a national centre right in the heart of Taranaki.'

However, she agreed that more would need to be done.

'If we just take hydrogen for instance, Australia invested a billion into hydrogen alone and hydrogen is only one piece of the puzzle.'

National energy spokesman and New Plymouth MP Jonathan Young said he was 'completely supportive' of the centre.

'It makes complete sense. There are a number of these around the world.'

However, two things had to also be taken into account - understanding that hydrocarbons still had a part to play in the transition, and collaborating with other research centres around the world.

'We don't want to reinvent the wheel. We want to be able to springboard off their research.'

Chief executive of oil and gas association Pepanz, Cameron Madgwick, said New Zealand currently had an energy mix and that was likely to continue.

'Natural gas will be a part of of the energy mix in the future as well.'

The Camerons' presentation showed emissions were a complex issues and it wasn't just about the energy sector, Madgwick said.

The announcement came a year after the government's shock policy decision that no new offshore oil and gas exploration permits would be granted and onshore permits would be restricted to Taranaki.

In a press release, First Gas chief executive said Paul Goodeve said a hydrogen-pipeline trial was one of the first projects likely to start at the NNEDC.

He said the New Plymouth-based company, which owns and operates gas networks, would base staff at the centre to design and run a trial of transmission and end use of hydrogen or hydrogen-blend gas.

Goodeve said trials were starting up all over the world and must start here in New Zealand if the country was to have all options on the table to achieve net zero emission targets.

First Gas general manager of commercial and regulation Ben Gerritson said: 'For us it means an opportunity to test how our network responds with the new fuel; an opportunity for our staff to develop their skills and understanding about hydrogen.'

Energy minister Megan Woods said the energy centre was was something that Taranaki itself had wanted.

'It was part of its strategic roadmap,' she said.

The role of the hub would be as a conduit between the research and the technologies, she said.

There would be 45 people directly employed at the centre but its role in commercialising meant the ripple effect would be felt in the industries. .

Holdom said the investment from the government recognised Taranaki's engineering and energy capabilities would be critical to keeping the lights on for many years to come.

Holdom said the region was working on further plans to grow the region's energy ecosystem and would continue to work closely with government ministers to develop plans which supported 'NZ Inc' and created opportunities for Taranaki people and businesses.

Venture Taranaki, Taranaki's economic development agency, first prepared a concept for a centre focused on energy technology research for MBIE's Regional Research Institute initiative but the application did not make the final cut.

In April last year, following another VT-led application, the Provincial Growth Fund invested $100,000 towards a feasibility investigation of establishing a New National Energy Development Centre.

The centre itself will not be a research hub but will coordinate and support opportunities for new energy technologies to be tested and further developed for commercial or large-scale use.

There may also be opportunities to explore how existing petroleum infrastructure and technologies could be re-purposed to support new energy ventures.

In a written statement, VT chief executive Justine Gilliland said with a strong energy sector Taranaki was well-positioned to be at the forefront of the low-emissions future.