Gas (Market Transparency) Amendment Bill

Gas (Market Transparency) Amendment Bill First Reading Debate resumed. SIMON COURT (ACT) (23:26): Thank you, Madam Speaker. This bill provides for disclosure of really important information at a time when New Zealand, like many other countries, has discovered that there is nothing more important than energy reliability, security of supply, and affordability. That is why the main policy proposals are that gas industry participants provide information about how much gas is being supplied or used by customers; about agreements to trade gas, including volumes traded; who are parties to agreements; the duration of contracts; information about an industry participant; and information that may have that may help decision makers. All of this contributes not just to Governments, not just to industry participants, but to New Zealanders’ understanding about this vital energy resource, its value, and therefore what should we do when it becomes scarce. Because scarcity drives certain behaviours. Scarcity in the gas market drives investigation, exploration, and development. Now, we’ve heard from some members in the House that, yes, gas reserves and gas production have declined over the past few years. That is extremely concerning to large industries. You can only make bread at scale in New Zealand with natural gas. That’s because you can only make bread at scale anywhere in the world with natural gas ovens. There is no electric replacement for a natural gas oven to make all the bread in your supermarket. That is why we must have gas. What is important to note is in the regulatory impact statement, the gas industry—in fact, the upstream petroleum sector representatives Energy Resources Aotearoa—have pointed out that some information is so important and privileged and commercially sensitive that if it’s to be disclosed, it must be kept safe in a way that doesn’t endanger people’s businesses, while, of course, they support sufficient information for people to know where to drill, where to find more gas. It turns out New Zealand might be a tiny island, we might not be able to see what’s under the sea, but we sit on the eighth-largest continent in the world. Much of our geology—although members on the opposite side might not be able to see it because it’s under the sea and under the ground—has fantastic prospectivity for petrochemical and hydrocarbon resources which may be available in the future. Now, it may not be up to us—this generation—to actually get that gas out, but it is there for New Zealanders now and in the future. That’s why this bill is important. ACT supports this bill. We commend it to the House. ANDY FOSTER (NZ First) (23:29): I rise on behalf of New Zealand First to speak on this gas transparency amendment bill. This bill is common sense. We’re all painfully aware, as Simon Court has so rightly said, that since the Labour Government’s decision to ban offshore oil and gas, it’s got a pretty close relationship with that dramatic decline in gas supply. It was actually staggering to hear from Megan Woods that she can lecture us about supporting business when she cut the legs from underneath business. Hon Dr Megan Woods: Oh rubbish, Andy! ANDY FOSTER: As a direct result of that, that has been seen by people in the electricity industry—not the gas industry, the electricity industry—as the “worst piece of industrial vandalism this country has ever seen.” That is a direct quote, Megan Woods—direct quote. We have lost businesses. We have lost jobs. We’ve ended up paying more for our power because of that decision. The electricity industry will say that to you. The gas industry will say that to you. That is their responsibility. This regulatory impact statement (RIS) provides us with a clear-eyed analysis setting out why good information is important—critical for business decisions, investment, employment, and it says that we need to mandate information provision—that’s what it says. It will provide greater certainty to business in this time of falling supply. It will lower gas prices, it will lower electricity prices, and it will help decisions about the best use of gas. That is what— Hon Dr Megan Woods: It was in the ballot 2½ years ago. ANDY FOSTER: —Megan Woods—this RIS says. I’m sure you read it—I’m sure you read it. I’m sure you read it, even if you didn’t understand it. DEPUTY SPEAKER: I’m sure the member read it. I didn’t read it; the member read it. ANDY FOSTER: Madam Speaker, oh, I’m sorry—no, I’m not sure she read it. I’m not sure she read it. I commend this bill to the House. RYAN HAMILTON (National—Hamilton East) (23:31): We can’t manage what we don’t measure. I commend it to the House. Hon Dr DEBORAH RUSSELL (Labour) (23:31): The member Simon Court began his speech with something I think we all need to agree with—that energy security matters, that we need to understand where our energy is coming from, and that we need to be secure. That has become even more apparent in the last few months, as one of our major sources of energy in this country has been disrupted significantly. Energy security matters. Not just security, either, but energy sovereignty; energy that we control ourselves and energy that we understand where it comes from. This bill in part addresses some of that issue by at least requiring information. Information is going to be available to businesses, to Government, to manage our remaining supplies of gas. But I do want to address some of the points that previous speakers have raised. I want to put to bed, once and for all, the canard—the absolute canard—that ceasing new offshore oil and gas back in 2018 has somehow led to this decline in gas supplies now. That is an absolutely ridiculous thing to say. Gas supplies in this country have been declining for 25 years. As my colleague Megan Woods said, it is a matter of geology. There have been no new commercial gas finds in New Zealand for the last 25 years. When there were plenty of gas permits available—there are still plenty of onshore gas permits available—expiration was occurring. If we are to consider energy security, there are two things we must consider right now. One is understanding, deeply, the nature of the resources that are left that we need to manage in the next few years. The other is making the transition away from fossil fuels, and no matter what, gas is a fossil fuel. Yes, it’s a very effective fuel, but it is a fossil fuel. When I hear speakers from New Zealand First saying that somehow not allowing new offshore exploration permits back in 2018 has caused a catastrophic slide in the resources available to us, well, that is just like an old man shaking his fist at the sky. Carry on as much as they like, it does not change the truth of the world. Shake their fist at the sky all they like about all sorts of matters, rant and rave about it—it does not change the underlying geology. It does not change the underlying truth of the world. So let’s not hear that canard again. I mean, there’s plenty that they come out with over there, but that one is a particularly egregious one. In terms of this particular bill, it does do what it says on the tin. It does come up with some market transparency. It is notable that just within—well, technically, on the same day as it was tabled, the Government had to table an Amendment Paper that suggests a degree of carelessness, I guess, that these sorts of things happen, but we do really want to have an understanding as to why that happened, when we get to the committee stage of this paper. We do want to explore why it is appropriate that a Minister should have so much authority to say what information should be gathered. So this bill creates a regulation-making power rather than encapsulating what information the Minister can require in primary legislation. Now, there could well be good reason for that, but we will want to explore that at the committee stage. So given that the bill does what it says on the tin, we are supporting this bill, but we will be questioning it on the way through. In particular, I think the Government needs to answer for its alleged transition plan. It has none. It has no transition plan. It claims this is part of a transition plan. It has none. In fact, this is a Government that has embraced fossil fuels, that refused to sign up to the pathway to transition away from fossil fuels at COP 30. That has in fact been climate vandals, and, in some ways, this ongoing embrace of fossil fuels just keeps on adding to that. Despite all this, we do support this bill. DAN BIDOIS (National—Northcote) (23:36): This bill is part of our plan to fix the basics in our gas sector. It does this by strengthening and providing greater accountability. It ensures that we can build the future for this country and energy, a reliable and affordable gas market. I commend it to the House. DEPUTY SPEAKER: I actually had time to write that member’s name down in the length of that speech. Hon RACHEL BROOKING (Labour—Dunedin) (23:36): Whilst that is very exciting that we had a speech longer than, I think, 12 seconds, it’s also exciting today to be talking about a bill that has a regulatory impact statement (RIS). That’s a great start from this Government. Well done—well done. So, what’s in that RIS? Well, a little bit of it is redacted for commercial sensitivity, but in general it seems like a very good, considered RIS. However, it does not necessarily give the argument for why we are here in all stages urgency. I’ve heard some of the other speakers say that they need to get on with this—and, sure, this is an important thing; we should do it quickly. It could very quickly go to a select committee and be reported back. Hon Member: No, that’s not quick. Hon RACHEL BROOKING: Oh, I’m hearing dissatisfaction on that side. Just to prove my point, there has already been an amendment lodged in the Minister’s name, tabled, on this bill. It’s two pages plus half a page—2½ pages, the words in this bill, and already the Minister has made an amendment, and you think just a little bit more time might be a useful thing here. Hon Dr Megan Woods: One clause—you could’ve got it right. Hon RACHEL BROOKING: So, anyway— DEPUTY SPEAKER: Not me, Ms Woods. Hon Dr Megan Woods: You would’ve got it right, Madam Speaker. DEPUTY SPEAKER: I don’t know. But I’m not responsible for that. Hon RACHEL BROOKING: So what are we doing? What are we doing here? This is about—this 2½ pages—the collection of information, and information is good. We’re happy to be supporting some legislation around the collection of information. Now, we’ll have more questions about this, but it seems—I haven’t picked this up in all of the speeches. Most of the Government speeches are talking about gas reserves, but my understanding of this legislation is that whilst there is information to be obtained or that can be obtained about reserves, it’s also the distribution of gas in New Zealand as well. So it’s those two things. As I was saying, it’s a simple bill that enables regulations to be made, and, of course, we will be discussing in some detail exactly what those regulations are on. But an important question for the Minister is around why there’s so much discretion for the Minister in these new regulation powers. If it is simply to collect the information that we will be discussing, then why not just specify more certain criteria about what those regulations are going to be and restrict the discretion of the Minister? They could just be set out as regulations. Now, I know there’s some time to develop those regulations in the future and some time to talk to the various industry players who will be impacted by this end. Of course, going back to my earlier point, it’s a good thing to have those discussions I also noticed, from the other side of the House, some noise and some suggestion that somehow—magically—these information requirements are going to totally transform gas prices. I think the last speaker mentioned that this was going to impact gas prices, which is ambitious, and also that this is somehow due to Labour’s neglect. That’s something that the Minister said. Of course, in 2020, Labour commissioned the gas industry co-investigation, and I wonder if any of the members opposite have looked at that. Then, in April 2022, there was the start of the gas transition plan that was signed off by Cabinet, the terms of reference, and that work was continuing under the Labour Government, but what happened when the Government changed? Did they continue with this gas transition plan or did they bin it? They binned it, and that is a blight on that side of the House and anyone that is trying to claim some amazing credit for these 2½ pages. TOM RUTHERFORD (National—Bay of Plenty) (23:41): To quote my good friend Dan Bidois, “Let’s get it done!” I commend it to the House. Motion agreed to. Bill read a first time. DEPUTY SPEAKER: This bill is set down for second reading immediately.