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New Zealand Energy Scenarios Businessnz Energy Council, 2015 106 New Zealand Energy Scenarios BusinessNZ Energy Council, 2015 106 About the BusinessNZ Energy Council The BusinessNZ Energy Council is a group of New Zealand organisations taking on a leading role in creating a sustainable energy future for New Zealand. The BEC is the New Zealand Member Committee of the World Energy Council (WEC). All BEC members are automatically members of the WEC. Participation from members is very important to the BEC and its membership with and contributions to the WEC. Participation allows members to engage with both the BEC and the WEC programmes, help direct the outcomes of the programmes and by mutual exchange increase the value of their respective activities. The WEC offers extraordinary opportunities at the global, regional and national levels. Access to this high level network stimulates useful dialogue, promotes the exchange of ideas, aids the development of new New Zealand Energy Scenarios business partners and investment opportunities and provides valuable collaboration and information-sharing across the energy sector Further details at www.bec.org.nz Navigating energy futures to 2050 About the World Energy Council The World Energy Council (WEC) is the principal impartial network of leaders and practitioners promoting Project Partners an affordable, stable and environmentally sensitive energy system for the greatest benefit. Formed in 1923, the WEC is the UN-accredited global energy body, representing the entire energy spectrum, with more than Paul Scherrer Institute (Switzerland) 3000 member organisations located in over 90 countries and drawn from governments, private and state PricewaterhouseCoopers (New Zealand) corporations, academia, NGOs and energy-related stakeholders. The WEC informs global, regional and national energy strategies by hosting high-level events, publishing authoritative studies, and working Sapere Research Group through its extensive member network to facilitate the world’s energy policy dialogue. Further details at www.worldenergy.org and @WECouncil BUSINESSNZ ENERGY COUNCIL NEW ZEALAND, MEMBER COMMITTEE OF THE WORLD ENERGY COUNCIL BusinessNZ Energy Council Level 6, Lumley House, 3-11 Hunter Street. Wellington, 6011 New Zealand T (+64) 4 496 6555 F (+64) 4 496 6550 E [email protected] www.bec.org.nz www.worldenergy.org New Zealand Energy Scenarios BusinessNZ Energy Council, 2015 1 Officers of the BusinessNZ Project Sponsors Energy Council: Hon. David Caygill Chair John Carnegie Secretary-General Principal Contributors: BusinessNZ Energy Council David Campbell Advisor John Carnegie Secretary-General Dr Rob Whitney Emeritus Chair Sapere Research Group Dr Stephen Batstone Toby Stevenson PricewaterhouseCoopers Aaron Webb Lynne Taylor PSI Energy Economics team Dr Martin Densing Dr Evangelos Panos The individuals and organisations that contributed to this report are not responsible for any opinions or judgements it contains. All errors and omissions are solely the responsibility of the BusinessNZ Energy Council. New Zealand Energy Scenarios BusinessNZ Energy Council, 2015 2 With contributions from the Morris Pita members of the BEC2050 Energy Michael Thomas Scenarios Project Team and 2 workshop participants: Nick Wilson Nicolas Williams Aimee Whitcroft Nigel Broomhall Alan Eyes Paul Atkins Dr Allan Miller Paul Ravlich Andrew Garey Paul Young Andrew Saunders Ralph Chapman Bernie Napp Roger Lincoln Bob Frame Ron Murray Brian Moore Prof Rosalind Archer Campbell Roberts Shane Gowan Catherine Leining Sharron Came Chris Baker Spencer Morris Chris Durno Tony Everett Chris Taylor Wernher Roding Daniel Pringle David Gawith Doug Watson We would especially like to thank those who made themselves Gareth Wilson available to peer review the report: Gillian Blythe Grant Telfar Doug Heffernan Ian Horne Ged Davis Jayden Ravji Dr James Tipping Jenny Lackey Dr Joel Cayford Jeremy Clarke Mark Dean Jimmy Zhou Penny Nelson Prof Jim Metson Prof Ralph Sims John Kidd Jonathan Mills Jon Olson Josh Adams The individuals and organisations Judi Jones that contributed to this report are not responsible for any opinions or Julie Malcolm judgements it contains. All errors Kevin Faure and omissions are solely the responsibility of the BusinessNZ Linda Thompson Energy Council. Matt Gibbons New Zealand Energy Scenarios BusinessNZ Energy Council, 2015 3 Contents Foreword - Phil O’Reilly ................................................................................ 5 Foreword - Dr Christoph Frei ....................................................................... 6 Preface - Dr Rob Whitney……………………………………….………………7 1. New Zealand Energy Scenarios to 2050 ............................................... 8 Our WEC Trilemma Performance in 2050………………..……….…..…11 2. Introduction .......................................................................................... 12 3. BEC2050 - Facing Future Challenges ................................................. 13 The WEC Approach to Scenario Development ............................................... 13 The WEC Scenarios: Jazz and Symphony ...................................................... 14 Following The Leader ........................................................................................ 16 4. Scenarios for New Zealand .................................................................. 17 New Zealand Today ........................................................................................... 17 Decisions ............................................................................................................ 22 Uncertainty ......................................................................................................... 23 Dealing with Uncertainty ................................................................................... 25 New Zealand's Critical Uncertainties ............................................................... 29 Scenario Quantification ..................................................................................... 34 Model Inputs ....................................................................................................... 35 5. Using the Scenarios ............................................................................. 39 6. BEC2050 Narratives: Kayak ................................................................. 41 Kayak Snapshot ................................................................................................. 41 Setting the Scene: New Zealand's Place in a Jazz Rest-of-the-World Framework .......................................................................................................... 42 Our Kayak Story ................................................................................................. 42 Our Kayak Energy Future .................................................................................. 48 7. BEC2050 Narratives: Waka .................................................................. 56 Waka Snapshot .................................................................................................. 56 Setting the Scene: New Zealand's Place in a Symphony Rest-of-the-World Framework .......................................................................................................... 56 Our Waka Story .................................................................................................. 57 Our Waka Energy Future ................................................................................... 62 8. Comparative Analysis .......................................................................... 69 9. New Zealand in a Global Context ........................................................ 89 10. Alternative Stories ................................................................................ 93 Tipping Points .................................................................................................... 94 What Next? Extending the Possibilities .......................................................... 97 11. Appendix 1: Useful Information ........................................................ 100 Abbreviations and Acronyms ......................................................................... 100 Units .................................................................................................................. 101 New Zealand Energy Scenarios BusinessNZ Energy Council, 2015 4 General Conversion Factors for Energy ........................................................ 102 12. Appendix 2: List of Figures and Tables ............................................ 103 New Zealand Energy Scenarios BusinessNZ Energy Council, 2015 5 Foreword by Phil O’Reilly, Chief Executive Officer of BusinessNZ BusinessNZ’s members include major businesses and organisations operating across all spheres of energy provision, financing and use. Their contribution to the BusinessNZ Energy Council provides invaluable insights towards energy policy-making. This publication highlights the BusinessNZ Energy Council’s forward-looking approach. By generating scenarios for possible energy outcomes under different economic and regulatory conditions, the BusinessNZ Energy Council is helping create and prepare for a better energy future. I commend this work towards building a more secure, environmentally sustainable and competitive energy sector in New Zealand. New Zealand Energy Scenarios BusinessNZ Energy Council, 2015 6 Foreword by Dr Christoph Frei, Secretary General of the World Energy Council The World Energy Council (WEC) is the principle impartial
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