How can households take back control of their energy? The answer lies in the sky.
In this country, winter has become synonymous with unmanageable power bills. Most of us turn down the heater to keep our bills under control. Too many are forced to choose between a warm-enough home and a hot meal.
When it comes to electricity, we’re given the impression that we have options. Power companies advertise new products that promise to solve our home energy woes. Government programmes encourage us to “shop around” to get a better deal. But somehow the system always seems stacked against us.
That’s because it is. In the last 30 years, New Zealand households have seen their power prices rise by 79 per cent. In that same period, commercial rates have actually dropped by 24 per cent, leaving households to shoulder the cost of our electricity system.
Where has the rest of the money gone? A new study from Auckland University reveals that quite a lot of it – $5.4 billion to be exact – has turned into excess power company profits in the last seven years alone.
The study’s author, Dr Stephen Poletti, says despite what we’re told, New Zealand’s electricity market is not competitive. Just five companies still produce 90 per cent of our electricity and control 89 per cent of the retail market.
Back when the bulk of our energy supply was built, the hydro dams and power lines were paid for with taxpayers’ money for the public good. Since the 1980s though, our power system has gone through a process of corporatisation, deregulation, and privatisation. Ownership of this once public asset has largely shifted into private hands.
The promise of privatisation was more competition and a better deal. But, every winter, there are families shivering in cold, damp homes while power companies profit to the tune of hundreds of millions of dollars. As many as a quarter of New Zealanders live in energy poverty.
How can households take back control of their energy? As the days get longer and warmer, the answer is shining right above our heads.
Solar power, especially when paired with battery storage, has the potential to shake up our broken energy system in ways that could transform our lives for good.
Unsurprisingly, the big power companies won’t have a bar of it. Solar means that every one of us has the potential to put a power plant on our roof or in our community. For the industry, it’s frightening – because it’s what real competition looks like.
Locally-produced solar energy and storage has benefits for everyone – not just those with panels on their roofs.
The way our energy system works now, the whole grid is scaled to be able to meet demand during the few hours of the year when it’s highest. Think cold winter evenings when we’re reaching for the heater. It means we pay to build and maintain costly transmission and distribution lines that are only used a fraction of the time.
We also pay the high cost of using coal, gas and diesel power plants – so-called “peakers” – that fire up when demand is highest. Because overall electricity prices are set based on the cost of the most expensive form of energy, our bills soar when these dirty fuels are burning. Clean energy like wind, solar, and hydro have no fuel costs, so coal, diesel and gas plants are almost always the more expensive power source to run.
What solar and storage does is capture energy when it's most abundant and cheap. It then gets released back onto the local grid when it’s most needed. The benefits will be felt in lower energy bills for everyone who uses and pays for the distribution and transmission lines.
By reducing the need for dirty and expensive peaker plants, solar and battery technology can also prevent those huge price spikes we see when energy demand is at its highest. Not to mention keeping harmful carbon emissions out of our fragile atmosphere.
Right now, the Government is reviewing New Zealand’s electricity system. We have the best opportunity in a generation to give power back to people.
Greenpeace is calling on the Energy Minister to help solarise half a million homes in the next ten years, through an interest-free loan on solar panels and a battery. We’ve worked out that it would cost the Government just $33m a year – less than annual oil and gas subsidies.
As part of a wider programme of regulatory reform, doubling down on energy efficiency, and increasing support for community energy schemes, this is a once in a generation opportunity to ensure New Zealanders live more comfortably while increasing clean homegrown electricity for everyone’s benefit.
Amanda Larsson is a climate & energy campaigner with Greenpeace.
You can sign the Greenpeace petition here.