Te Waihanga Chief Executive Ross Copland said New Zealand has an opportunity to achieve net-zero carbon emissions by 2050, improve economic performance by unlocking new export opportunities, and lift our living standards by leveraging our abundant low-emission energy resources.

"We have abundant, untapped wind, solar, hydro and geothermal resources that, combined, are treble the amount identified by the Climate Change Commission for achieving net-zero carbon emissions by 2050. However, the issue is whether they can be developed at prices investors are willing to pay.

"New Zealand could generate wind power at a comparatively low cost by global standards - provided we are efficient at consenting and building new wind farms," he says.

"We have higher average wind speeds in Aotearoa than in most other places, meaning that our wind farms can produce more energy per unit than the global average. The least-windy sites in New Zealand have better wind energy potential than the windiest sites in Australia.”

Other low-emission energy resources are also abundant in Aotearoa. While most of the best sites for hydro generation are already being used, there are opportunities to increase geothermal electricity generation and develop large-scale solar farms.

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Falling costs

Between 2016 and 2020, the cost to generate energy using offshore wind farms declined by 29% and the cost to generate energy from onshore wind farms declined by 34%. This reflects improvements to wind turbine technology and the deployment of larger, more efficient turbines.

Over the same period, the cost of solar generation declined by 46%, driven primarily by declining capital costs.

Wind and solar generation are already cheaper than other electricity sources, and these trends are expected to continue.

New Zealand also needs cost-competitive backup generation to cover periods when demand is high, hydro reservoirs are low, the wind is light, and the sun is not shining. The report discusses options for addressing this issue, and concludes at this stage, it is unclear which option, or package of options, will perform best.

However, while the technology and resources are available, there are still some major barriers to achieving fully renewable energy generation, Copland says.

"Our resource management system needs to keep up with changing technology. We need to be able to consent and build larger-scale wind farms and use new turbine technology to generate electricity at a lower cost. We also need a sound regulatory approach for offshore wind farms, which could become cheaper than onshore wind farms in coming decades, if current trends continue.”

New Zealand needs to add an average of 494 megawatts of low-emission electricity generation capacity every year for the next 30 years to meet electricity’s contribution to achieving our net-zero carbon target, Copland says.

Other aspects of the report, including Onslow, are covered elsewhere in this week’s Energy and Environment.