Government should reinstate biofuel obligation

Monday 28 May 2012, 11:45AM
By Labour Party

Budget 2012 confirms that the Government has zero commitment to supporting and growing renewable energy technologies, says Labour’s Energy and Climate Change spokesperson Moana Mackey.

“The biofuels sector represents an enormous opportunity for the New Zealand economy, but its potential for development and growth has been ignored in Budget 2012.

“The sector is at the forefront of cutting edge technology; it provides highly skilled 21st century jobs, and at the same time helps reduce our dependence on fossil fuels.

“The Government, however, continues to act like the proverbial ostrich over biofuels, to the extent that it has even used the manufactured failure of its own subsidy scheme as an excuse to withdraw support for the industry altogether,” Moana Mackey said.

“One of the first actions the newly-elected National Government took in 2008 was to repeal the Labour Government’s biofuels obligation. The obligation required fuel retailers to ensure that a small percentage of the fuel they sold was biofuel. This provided certainty for biofuel companies who were considering whether or not to invest in New Zealand that there would be a market for their product.

“National replaced this obligation with a costly subsidy for biodiesel which was clearly unworkable. It is the predictable failure of this subsidy, introduced to replace the Labour Government’s biofuels obligation, which has acted as a scapegoat for cuts.

“Unfortunately biofuels are not the only victim of Budget 2012. Renewable energy lost out across the board,” said Moana Mackey.

“It is unbelievable that at a time when we should be investing in alternative technologies as a way of transitioning New Zealand to a low-carbon economy, reducing our reliance on fossil fuels, and reducing our greenhouse gas emissions, the Government has its foot on the brake.

“The Minister needs to demonstrate a clear commitment to the renewable energy sector.  It would send an important message to those operating and investing in clean energy companies if the Minister showed as much enthusiasm for sustainable options as he does for fossil fuel exploration and extraction.

“Reinstating the biofuels obligation would position investment in clean-tech and renewable energy as a government priority,” Moana Mackey said.