The Government is delivering on a key election commitment to tackle climate change, by banning new low and medium temperature coal-fired boilers and partnering with the private sector to help it transition away from fossil fuels.
This is the first major announcement to follow the release of the Climate Commission’s draft package of advice to Government in February.
“Today’s announcements will make a real difference to New Zealand’s emissions profile, and are a significant boost to our clean energy sector, helping us on our path to a cleaner, smarter economy,” Minister of Energy and Resources, Megan Woods said.
The ban on new coal boilers used in manufacturing and production will come into effect by 31st December this year. An option proposed is to also prohibit other new fossil fuel boilers where suitable alternative technology exists and it is economically viable.
The Government is also proposing to phase out existing coal boilers by 2037. In addition, consideration is being given to how to phase out other fossil fuels in existing sites through re-consenting processes and best practice requirements in a National Environment Standard.
“The amount of coal displaced by these proposals equates to about 500,000 tonnes each year. Once the changes are fully in place it will mean the equivalent of between 400,000 to 550,000 cars being removed from our roads in a single year,” Ms Woods said.
Also announced today were the successful applicants in round one of the Government Investment in Decarbonising Industry Fund. In total 14 companies will receive $22.88m in co-funding to help their businesses transition away from fossil fuels.
“The decarbonisation fund provides crucial financial support to business and industry to help them switch from boilers run on coal and gas to cleaner electricity and biomass options. This helps create jobs in the clean energy sector, and future-proofs our economy,” said Minister Woods.
“The 14 projects(2) we’re announcing funding for today will achieve up to 10 percent of the gross long lived emission reductions required from the Climate Commission’s first draft carbon budget for the period 2022-2025(1) – the same as taking 49,000 cars off the road.”
Minister for the Environment, David Parker said both the decarbonisation fund and the coal boiler initiatives were helping reduce emissions in the manufacturing and production sector.
“Fuel used in manufacturing and production – known as process heat – generates about eight per cent of New Zealand’s emissions and is the second largest source of energy-related emissions after transport,” he said.
“Decarbonising process heat is one of the biggest opportunities for New Zealand to reduce its domestic energy emissions, and will make a significant contribution to New Zealand’s 2050 net zero carbon target.”
Climate Change Minister, James Shaw said with today’s announcement, the Government had taken another necessary step on the road towards a low emissions economy for Aotearoa New Zealand.
“By working with industry to switch from burning coal to clean alternatives we are helping to ensure a better, cleaner future for our children and grandchildren,” Mr Shaw said.
Two of the companies who have received round one funding are McCain Foods and Woolworks both in Timaru.
“McCains and Woolworks(3) are two great examples of businesses that are committed to taking a leadership role on climate change through their uptake of the decarbonisation fund. It’s great to see them embracing clean technology while not compromising on productivity,” Minister Woods said.
The consultation document for the 2037 coal proposals can be found on the Ministry for the Environment website.