In the first of a two-part series on the just transition to a low carbon economy in Taranaki, Marc Daalder reports business and political leaders say the Government’s approach is scattershot and uncertain, while experts say it isn’t ‘best practice’
Life in Taranaki has to change.
The region produces 7.1 percent of the country’s emissions but has just 2.5 percent of the country’s population. That means it has the second-highest per capita emissions, behind only Southland. In 2018, 46.1 tonnes of greenhouse gases were emitted in Taranaki for every head of population.
The centre of the country’s oil and gas industry (it produces more emissions in ‘Electricity, gas, water, and waste services’ than any region other than the Waikato) has also been the centre of focus for our just transition away from fossil fuels. The Government followed up its 2018 decision to ban new permits for offshore oil and gas exploration with tens of millions of dollars in funding for a pivot to renewable energy.
But the region’s political and business leaders say the approach so far has lacked consultation and necessary planning, leaving both the fossil fuel producers and the region’s dairy farmers in a state of uncertainty.
What is the just transition?
Everyone Newsroom spoke with in Taranaki agreed that the region – and New Zealand more broadly – needed to decarbonise.
“Transition is a no-brainer. I think only someone who’s got their head buried in the sand would not support transitioning to a low-carbon economy. It’s the only way to go,” Arun Chaudhari, the CEO of the Taranaki Chamber of Commerce and a former captain of oil tankers, told Newsroom.
This will mean some people will no longer be able to continue working in the jobs they currently hold.
That doesn’t mean, however, that those workers will not be able to find new employment in energy or agriculture, using similar skills. That’s part of the heart of the just transition – “the idea that justice and equity must form an integral part of the transition towards a low-carbon world”, according to a United Nations paper on the subject.
In other words, while change is needed, that change should not aggravate existing inequities and should in fact, where possible, seek to alleviate those inequities. It encapsulates questions around the varying levels of responsibility for the climate crisis and whether everyone should pay equally to address it even if some countries are more developed than others.
Just transition also means workers shouldn’t get the short end of the stick from decarbonising the economy, while wealthy executives at the multinational fossil fuel companies that employed them live on the profits from years of polluting and obfuscating the truth about climate change.
“This industry has known about the climate change impacts that they are causing for decades. They knew if before the the government did. They’ve been covering it up, selling false messages,” Catherine Cheung, a researcher at Climate Justice Taranaki, told Newsroom.
“But if I’m an oil worker, did I know? It is the responsibility of the industry, the people at the top. We can’t blame the workers.”
Amanda Larsson, Greenpeace New Zealand’s energy and climate campaigner, told Newsroom that while she supports the just transition, she’s concerned just transition rhetoric could be used to delay decarbonisation.
“A lot of the language the Government is using around just transition is kind of being used to justify a slow response to climate change. What I would say is, climate change is happening, fossil fuels are causing it and we need to stop using fossil fuels. That’s urgent and you can’t negotiate with physics on that. But how we do it is what you have a choice about,” she said.
Putting the cart before the horse
Either way, workers will feel the impacts of a transition, but those impacts can be cushioned.
That’s what the Government is attempting to do by pouring cash into Taranaki in search of green replacements for burning fossil fuels.
But South Taranaki mayor Phil Nixon says the Government put the cart before the horse by announcing the ban on new offshore exploration permits and only then scrambling to find something to fill the gap in both the region’s job market and the country’s energy supply.
On the latter front, coal burning in New Zealand has increased under the coalition Government. Critics say this is because the oil and gas that would normally serve as insurance when hydroelectric stations can’t make up the slack in dry years has had its supply disrupted by the exploration ban.
“You don’t just pull the plug and then decide you needed some of the water,” Nixon said.
“That’s what we’ve actually had is the plug basically pulled on us and now we’re scrambling to fill gaps. The green hydrogen project at Kapuni is really exciting, but that’s going to need huge infrastructure if that goes ahead.”
Gerard Langley, the communications manager at South Taranaki District Council, agreed.
“You don’t transition and fill an economic gap such as that left by the oil and gas sector, which is billions of dollars for the Taranaki economy. You can’t just transition and fill that gap overnight and you can’t do it by splashing a few million dollars around here and there,” he said.
Nixon said the situation reminded him of a photograph at Hāwera’s Tawhiti Museum of the first automobile that came to the town. It was loaded up not just with supplies for the road, but also with spare tyres, wheels and cans full of all the petrol it would need to make the trip .
“When that car came, there were no petrol stations, there were no garages, there was no one to fix the tyres. It’s exactly the same thing as what’s happening with the hydrogen thing,” he said.
“If we’re going to get buy-in for that properly, we have to have buy-in for fuel stations. It might be alright here in Taranaki, but if a truck running on hydrogen has just gone to Auckland, it’s got to fill up when it gets there. You can’t just put some cans of hydrogen in the car and cart them there either.”
Chaudhari points to Taranaki’s engineering sector as an example of an industry harmed by the cart before the horse strategy. The sector is heavily reliant on the oil and gas industry, but it doesn’t have to be.
“What I fear is that the engineering base is eroding because we jumped too fast. We’ve got a lot of engineering expertise that’s disappearing. We could manufacture wind turbines here, for example. It’s a very specialised skill.”
But the Government hasn’t laid the groundwork for a project like that – and by the time it has, all our engineers may have moved overseas, he said.
“Nobody really wants to invest in an industry where there is no clear plan or where there’s so much uncertainty.”
‘A proper model for planning’
In other words, for Taranaki to make the transition, the Government will have to invest vast amounts of money not just in the region but across the country and lay out a clear plan for the just transition going forward.
New Plymouth mayor Neil Holdom doesn’t think that’s happening.
“They’ve actually thrown a very small amount of money at it but talked about it a lot,” he said of the investment in hydrogen.
“There’s some tens of millions being committed but nothing, or very, very little has been spent.”
The just transition hasn’t yet materialised in Holdom’s view – and long-term planning is needed if it is going to. Otherwise Taranaki will experience the same disruptive transition that Southland is poised to undergo when the aluminium smelter leaves.
That planning is a major complaint for people in the region. If the Government is planning to swap out an entire industry with a brand new one, that requires a level of specificity and foresight Holdom says he isn’t seeing.
“If you want [the just transition] to be meaningful and sustainable, you’d actually just look at it as a proper model for planning,” he said.
“That’s what a just transition to me looks like, is it’s planning. The way it’s spoken about now is as an intervention.”
But a transition is a process and Taranaki’s can’t happen overnight.
Justine Gilliland is the CEO of Venture Taranaki (the region’s development agency) and the architect of the Taranaki 2050 roadmap. It’s a co-designed local government plan sketching out, in broad strokes, what the just transition looks like.
That doesn’t just mean oil and gas, but also transport, agriculture and construction – including energy efficiency in new buildings and the emissions impact of the building materials themselves. But despite having sketched out her own plan, Gilliland agrees that a more concrete approach from central government is needed.
“Our roadmap is about a low-emissions future. It’s not about saying that oil and gas are necessarily out and bad. We’re agnostic as to energy source because what’s important is to focus on the problem. We need to make sure that we are not unnecessarily ruling out options too early on,” she told Newsroom in an echo of Nixon’s comments.
“There isn’t enough planning yet. Part of what we’ve done with establishing Ara Ake [the new energy development centre funded by the Government in Budget 2019] is that entity is going to help provide some of that energy projection work.”
Consulting with the community
Gilliland also says there hasn’t been enough consultation with affected communities, especially ahead of the ban on new offshore exploration.
“Absolutely there does need to be a lot more thinking and consultation before these sorts of decisions are taken. Yes, those sorts of regulatory changes should be better planned and transitioned through,” she said.
“This intervention that was done was with zero consultation,” Chaudhari said.
“That was a huge mistake and I think to rectify that, there needs to be input from industry, there needs to be input from business. I’m a bit hesitant to call it a just transition in that respect.”
David Hall is a senior researcher with The Policy Observatory at AUT and the author of a book on just transitions, A Careful Revolution: Towards a Low-Emissions Future.
“I don’t think that what happened in Taranaki was necessarily best practice from a just transitions perspective, because I think ideally some of the strategy around clean energy development might’ve been announced in advance of the suspension of [new] offshore oil and gas permits,” he told Newsroom.
“So from a best practice perspective, I think there is room for improvement. But they’ve done a good job of following that up with a strategy.”
Hall said while more planning might be called for, there will always be some level of uncertainty baked into the transition.
“This is unfortunately partly the nature of these long-term socioeconomic, socio-technological transitions. There’s a lot that is uncertain and it’s a lot about managing uncertainty. You’ll probably never get to the level of certainty that people are completely comfortable with.
“It is an acknowledgement that there is a tragic quality to these transitions. I think that’s where just transitions is at its best, when it’s acknowledging that disruption, acknowledging the suffer and acknowledging the discomfort that people have and doing best to recognise that and to adapt and to support those people who are suffering through the transition.”
The second part of this two-part series, exploring what an effective and just transition in Taranaki would truly look like, will run later this week.