Leveraging our energy resources to reduce global emissions and increase our living standards

New Zealand has an abundance of low-emission energy potential. We can grow our low-emissions energy generation beyond what we need to meet our climate change commitments, to create high-wage jobs for New Zealanders and reduce carbon emissions globally.

Based on our own research and drawing on publicly available information this research provides technical analysis in support of this ambition.

Key findings

• New Zealand has abundant natural resources for low-emission electricity generation. We have untapped wind, solar, hydro and geothermal resources that, in aggregate, are treble the amount identified by the Climate Change Commission for achieving net-zero carbon emissions by 2050.
• Our electricity system could become more internationally competitive as preferences for low-emission electricity increase.
• We could become cost-competitive in wind generation as relative to the global average, we have high wind speeds across much of Aotearoa, which means electricity from our windfarms should be lower cost than the global average. However, that does not appear to be the case due to relatively high installation costs. If we can reduce those costs, then our abundant wind resources could be competitive internationally. 
• Our backup generation needs to be cost-competitive for our wind resources to be internationally competitive. This backup generation is needed to cover periods when demand is high, hydro storage is low and the wind is not blowing. For our wind resources to be competitive, our backup generation needs to be low-cost, or at least no more costly than in other countries.
• Developing our low-emission resources could improve wages in Aotearoa and reduce global emissions. Due to an abundance of low-cost energy, low energy prices can drive economic prosperity in the short run, which can permanently lift income per capita.