WASTEFUL SPENDING ON BONKERS POLICY

By Simon Court, ACT Party spokesperson

LABOUR’S BIOFUEL MANDATE POLICY was bonkers, and now they have dropped it.

“Anything which makes transport fuels more costly is bad for business and ultimately bad for consumers,” was my take on it when I wrote my June 2022 column for this magazine.

In stark contrast, Energy and Resources Minister Megan Woods said the Biofuels mandate was necessary because: “This is where the rubber hits the road. If parties are not going to support this bill, I want to hear where 9 million tonnes of emissions reductions are coming from in other parts of the economy, and I look forward to that.”

Now Labour has dropped the mandate, and after nearly two years of consultation, passing the first reading of the Sustainable Biofuels Obligation Bill through Parliament, and weeks of Environment Committee hearings, Labour finally worked out what we always knew. I doubt Megan Woods would be keen to answer the challenge she presented back in June.

Forcing suppliers to add expensive biofuels to transport fuel was always going to cost working people money, and leave the poorest who depend on their cars to get to work and study with less to cover food and bills.

The Environment Committee heard from environmental groups that told us growing and refining biofuel creates more carbon emissions than producing diesel for crude oil. Making biofuels from food crops pushes up the price of food and encourages deforestation in developing countries.

Oil company executives confirmed the only countries where biofuel is widely used had to subsidise it or mandate its use at a direct cost to the consumer.

Fuel suppliers highlighted the cost and time to build additional storage to meet the mandated volumes, costs which would be passed on to consumers at around 5 to 10 cents per litre of petrol or diesel. They also pointed out how hard it is to get consents for fuel storage tanks and infrastructure.

Penalties for failing to supply the correct percentage of biofuel were up to $800 per tonne, or ten times the price of a carbon credit under the Emissions Trading Scheme.

The Committee members were surprised to learn that Mobil already supplies biodiesel to New Zealand customers, and that Gull has supplied petrol containing bio-ethanol since 2007. Gull has delivered 65 million litres of biofuel to New Zealand, enough for 1.3 million fill ups.

Gull’s CEO also pointed out that bio-ethanol receives a rebate of 35 cents per litre on fuel excise duty. There is already a subsidy in place, and suppliers are delivering biofuels to New Zealand consumers.

The committee heard detailed feedback from everyone ranging from environmental groups to oil companies. This should have been where the policy was dropped, but Labour persisted with it until their polling told them they needed to can it.

That leaves the Government in the same place they started. What could actually reduce carbon emissions to help New Zealand meet the climate targets that Labour has told us are vital, like reducing the amount of vehicle kilometres travelled?

Accurately recording mileage with GPS could help businesses save money while demonstrating lower emissions. Yet Waka Kotahi persists in running New Zealand’s’ roading network and fleet as if we are still living in the 1980s.

Hubometers required by NZTA were originally designed to monitor trailer fleets so operators knew when to replace bearings and running gear on trailers. Mechanical speedometers may overestimate the distance travelled by 5-10 %.

A fleet manager pointed me to their GPS units are much more accurate than a mechanical hubometer or odometer and show that trucks and trailers are actually travelling less distance than recorded through the speedo and odometer.

They have to pay for RUCs based on the mechanical odometer, even though the technology is available to give a more accurate and cost-effective reading, showing a lower emissions profile.

This is a simple solution, and wouldn’t have the same negative impact of greenwashing poor environmental outcomes while virtue signalling about saving New Zealanders from a “climate emergency”.

Labour has spent over $4.8 million on consulting, setting up a new regulator at the Environmental Protection Agency, and pushing hastily drafted law through Parliament. Now the mandate policy is cancelled, we can’t get that money back, or the time wasted by business in responding to these daft proposals.

Can we really risk more of the same bad policy making? In 2023 voters will have a chance to choose ACT over the old duopoly, a practical and solutions-focussed party to deliver real change. T&D

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