NZ and international Chief Executives gathered at the biennial Asia Pacific Energy Leaders’ Summit to discuss the key strategic energy issues they face as the sector grapples with change and the emerging opportunities.
The BusinessNZ Energy Council and World Energy Council hosted the Summit at the Museum of New Zealand, Te Papa.
Summit delegates gathered to consider the three challenges facing the energy sector (known as the 3Ds – decarbonisation, digitalisation, and decentralisation) – and how they are shaping the energy sector of today and tomorrow.
A CEO Roundtable sought to place these three dimensions into a broader strategic context. For example, what might a prosperous, inclusive and sustainable economy look like in 10 or 20 years?
New Zealand’s geographical isolation along with rich land and water resources has led to a large renewable electricity supply that is the envy of many nations, and that has fostered innovation in its primary agricultural and tourism sectors.
But in what areas do New Zealand businesses want to become global leaders in the future? Our energy future will differ depending on the extent to which we actively choose to pursue certain societal, economic and environmental outcomes or defend the status quo.
And if we choose a particular pathway, what do we need to collectively solve along the way to be successful? Do the conditions for success already exist to be built on, or do they need to be created?
World Energy Council Secretary-General Christoph Frei says: “Even more important than some of the short-term signals is clarifying what New Zealand wants to be known for and building a coherent competitiveness strategy around that, which drives energy decisions.”
Sector CEs agreed that a clear, ambitious and politically durable climate change target is a necessary but not sufficient condition. They discussed what a competitive economy would need to look like in order to deliver on such a target.
New Zealand is uniquely well positioned to do this with a liberalised energy market and an external trade-based focus.
A set of issues emerged that CEs, through the BusinessNZ Energy Council and the World Energy Council, have agreed to work on as a sector and in collaboration with government:
- clarity around the role expected from energy as a key driver for agricultural and industrial competitiveness as well as the requirement regarding decarbonisation
- the continued focus on maintaining and developing a high-value energy economy that fosters leadership and technical capability, and that attracts higher wages
- the need for greater co-ordination. To “soften the silos and moats” across the energy supply chain and to help ensure that policy outcomes are better joined up
- to encourage and support greater societal and political understanding and resilience during the change process, including ways that keep energy affordable and reliable
- access to the capital and/or risk management tools required to bring forward action to achieve the transition, including the development of clear policy frameworks within which to operate
- clarity around the role that liquid fuels (biofuels and/or hydrogen and derivatives) will play in our energy future, especially in terms of energy security in dry years and heavy transport
- the encouragement and growth of innovation, including support for the wider innovation ecosystem and the conditions for ‘fast-failure’ as the sector explores the rapidly evolving opportunities to enable the energy transition
- being consumer-centric, and working with their aspirations, including the development and co-ordination of demand-side response and energy-efficiency tools and platforms, the implications of greater household energy supply – the so-called ‘generation beyond the meter’- and the use of networks to commercialise their distributed energy resources
- greater leadership at the central and local levels, including the resolution of regulatory barriers at both levels
- moving from pilots to scale, including how to resolve the ‘scale’ problem
CEs are excited by the challenge ahead, and thanked the BusinessNZ Energy Council and the World Energy Council for advancing the energy agenda in New Zealand through its leadership in the Asia Pacific Energy Leaders’ Summit 2018.