World Coal Institute Country Profile - New Zealand


We have provided the following information for the World Coal Institute (WCI) website as part of an initiative to create a section on Country Profiles. There are 13,000 visits monthly and the site is an important source of information on the global coal industry.  We update the information regularly as new data becomes available - last updated May 2008.

 

Country Background - New Zealand

This section provides key energy facts, giving a general background to the national energy scene.

 

Primary energy consumption - breakdown of fuels (%)

Primary energy consumption by fuel for calendar year 2006 (Ministry of Economic Development Energy Data File figures) was:

Oil 37%

Gas 21%

Coal 12%

Hydro 11%

Geothermal 12%

Other renewables 6% (wind, biogas, wood and solar water heating)

Waste heat 0.1%

 

Coal production & consumption (million metric tonnes)

Coal production reached 4.6 million tonnes in 2007. Of this, 2.01 million tonnes were exported, primarily low ash and low sulphur bituminous coal for steel making. 0.73 million tonnes of coal was imported, with the total consumption 3.3 million tonnes.

 

Coal reserves

New Zealand has extensive coal resources, mainly in the Waikato and Taranaki regions of the North Island, and the West Coast, Otago and Southland regions of the South Island. Total in-ground coal resources are estimated at about 15 billion tonnes. Of this, 8.6 billion tonnes (made up of about 80% lignite, 15% sub-bituminous coal and 5% bituminous coal) is judged to be economically recoverable, although this has some uncertainty as the most recent published inventory of coal resources needs extensive revision.

 

Brief summary of current status of national energy market

Total primary energy supply for calendar year 2006 was made up of oil (37%), gas (21%), hydro (11%), coal (12%), geothermal (12%) and other renewables (6%). New Zealand's energy transformation industry includes petroleum refining, petrochemicals and electricity generation. In 2007, 67% of the total input into electricity generation was from renewable resources (predominantly hydro), 26% was from gas and 7% was from coal.

 

Coal Production & Consumption

A more detailed section looking at coal production and consumption.

 

World rankings in coal production & consumption

Very low - production 4.7 million tonnes in 2007, 23% lower than the previous year. The decline was due to reduced production from Solid Energy's two largest West Coast coal mines, which mainly produce coal for exports.

 

Main coal producing companies

Solid Energy is New Zealand's largest coal producer ? producing over 80% of New Zealand?s total coal production.

 

Major coal-fired utilities

There is one 1,000 MW coal fired power station in New Zealand (Huntly Power Station in the North Island), the use of this has been scaled back in 2007 in favour of gas. Other major coal consumers are dairy processor Fonterra and New Zealand Steel.

  

Number of coal mines

In 2007, New Zealand has 26 operating coal mines - four underground and 22 opencast mines. Over 60% of national production was from two large opencast operations, at Rotowaro and Stockton, and a further 16% from New Zealand?s two largest underground mines, Huntly East in the Waikato and Spring Creek at Greymouth.

  

Breakdown of coal consumption sectors 2007

Sector

% of Domestic Coal consumption

Electricity generation

39%, 1,185,372 (t)

Other transformation

26%, 785,155 (t)

Industry

26%, 826,477 (t)

Commercial sector

6%, 178,092 (t)

Agriculture

2%, 65,469 (t)

Residential

1%, 30,092(t)

National Transport

0.1%, 3077 tonnes

 

Coal consumption by industry 2005

Industry

2005 (%)

Electricity

43%

Steel

35%

Dairy processing

5%

Wholesalers

4%

Industrial processing

4%

Meat processing

3%

Cement

2%

Timber processing

2%

Health

1%

Other

1%

 

Electricity Generation

In 2007 New Zealand's electricity generation was 42,393 GWh. 55% of New Zealand's electricity is produced from hydro with 7% supplied by coal.

  

Breakdown of New Zealand electricity production (%)

Hydro 55%

Gas 26%

Geothermal 8%

Coal 7%

Wind 2.2%

Others 1.8% (oil, waste heat, biogas and wood).

 

Growth in electricity generation over last 10 years 1997-2007

In the last 10 years electricity generation has grown by 19% - 6654 GWh.

 

Projected rates of growth in electricity generation

Ministry of Economic Development's recent Energy Outlook to 2030 assumes a Base Case electricity generation of 47,800 GWh by 2015 - growth of 13% from 2007.

 

World ranking

Low

  

Environment & Clean Coal Technologies

A general introduction to environmental issues surrounding energy consumption in New Zealand.

 

Specific national environmental challenges

Climate change, particularly a CO2 tax possible on thermal power generation only. Air quality issues especially for coal use in towns with fine particulate pollution from household wood burners. Water quality particularly from old mine workings.

 

National regulations - emission limits, air quality standards

New National Environmental Standards on Air Quality are in the process of implementation. These have tightened restrictions on fine particulate emissions.

 

Government policies/actions to support clean coal technologies

A draft New Zealand Energy Strategy, a draft National Energy Efficiency and Conservation Strategy and a draft climate change policy are about to be released. Government energy objectives are reliability and resilience, environmental responsibility and fair and efficient energy prices for current and future generations in the transition to a low carbon energy sector.

Names of major research programmes into CCTs

Hydrogen energy for the future of New Zealand - including a major objective on production of hydrogen from carbon derived fuels.

 

A significant three-year research programme into CCS have been initiated in 2008.

 

International Activities

Involvement with relevant environmental agreements/organisations

Signatory to Kyoto, membership IPHE, IEA-CCC, IEA-GHG R&D Programme and Coal21, CO2CRC(Australia).

 

Involvement in international research programmes

         See above.

 

Challenges Facing Coal

Details on specific challenges facing the coal industry and energy sector more widely

Depletion of major gas reserves is highlighting the importance of coal resources. High mining costs may mean increased imports in the near future until there is large scale use of lignite resource. Political concern over greenhouse gases means there is a possibility of specific regulations against new coal fired power stations.

 

Government Information

Name of relevant ministers

The Minister of Energy is the Hon. David Parker.

 

National Association

Short summary of national association

The Coal Association of New Zealand (Inc.) represents coal producers and the wide range of coal users in New Zealand.  The Coal Association of New Zealand represents the interests of over 95% of New Zealand's coal producers and industry users. In total, 16 coal mining enterprises in New Zealand are producing over 5 million tonnes of coal annually from 26 operating mines.

 

The Association liaises with the Government and the community, and promotes government and industry research investment to strengthen the industry's competitiveness and environmental acceptability. Our main research provider is CRL Energy Ltd.

 

New Zealand has reserves of coal that can provide affordable, environmentally sustainable and secure energy for hundreds of years. Energy is important to the New Zealand economy and a key policy objective must be to deliver the lowest cost energy possible. The need to maintain competitiveness and developing technologies demand that these coal reserves be part of New Zealand's future energy portfolio.

 

The Coal Association works actively to ensure coal continues to contribute to New Zealand's prosperity. Our vision and scope of activities focuses largely on the development and deployment of new technologies. Clean coal and carbon and capture technologies provide the main pathway to addressing environmental issues from coal utilization. The Coal Association is investing in research relevant to their application to New Zealand coals, principally through an industry government research and investment partnership established in 2006. Complementing this partnership is membership of key R&D organisations such as the Australian based CO2CRC, the IEA CCC and the IEA GHG R&D Program. These links and collaborations allow the Coal Association to be involved in international projects and informed on advances in coal-based energy production around the world.

 

In addition, the Coal Association supports the $6 million Foundation for Research, Science and Technology research programme "Hydrogen Energy for the Future of New Zealand" as a first step in New Zealand's possible transition towards a hydrogen energy economy. The Association has invested in related areas of advanced technological and environmental issues, including the development of a Hydrogen Roadmap for the coal industry and technologies. It also a member of the Carbon Capture and Storage (CCS) Research Steering Group - a joint Government/industry initiative led by the Foundation for Research, Science and Technology, which supports a three-year research programme (started in 2008) to investigate New Zealand's carbon capture and storage potential.




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