Mokihinui and Stockton: all about the power

State owned enterprises Meridian and Solid Energy have gone feral down on the wild West Coast, where it's every man for himself and his hydro proposal

Remember when Helen Clark misspoke, and called West Coasters "feral"? There must be something in the water down there: our SOEs have caught it.

Four West Coast hydro power proposals have been floated. One of them, Arnold, seems quite uncontroversial. The other three are gun fights down at the OK Corral, otherwise known as ‘resource management court’.

Commissioners split 2:1 on resource consent for Meridians Mokihinui proposal. Forest and Bird, the Department of Conservation (DOC), and others, are appealing the consent, backed by a sort of ragged dawn chorus of the Greens, Peter Dunne, and assorted pro-conservationists. This is what’s at stake; the civil engineer and regional councillor who overruled the ecologist waxed lyrical about it:

“If the Mokihinui River were to be considered in isolation, it would be difficult not to form the view that to build a dam and flood the gorge would be a travesty. When we walked through several sections ... we could not help but be overwhelmed by its natural beauty."

Nevertheless, on balance, they were satisfied it needed to proceed. And here, Meridian is lovin’ its wild west metaphor, as it lays out its superficially plausible case, about security of the West Coast’s tenuous supply, and energy efficiency, because up to 50 percent is currently wasted in transmission. They promise a stunning new lake — a playground and water access route to the back country — and, alongside it, an upgraded tramping and mountain biking track.

They promise, in other words, substitution of a recreational place for a wild one. Their 85-metre high concrete dam is the great grey elephant in the room.

Meanwhile, the Stockton plateau, minus snails, is a wee energy hub, a very beehive, if you will, of activity. Solid Energy mines coal there, and private enterprise Hydro Developments Ltd (HDL) has a — you guessed it — hydro proposal.

By contrast to the Mokihinui, this is an irretrievably altered environment. HDL wants to divert acidic waste water flowing out of the Stockton mine, dilute it with the thundering torrents of West Coast rain, run it down a steep gradient that, in combination with the volume, can produce a lot of power, and discharge it straight out to sea — thus cleaning up the ruined Ngakawau River, for net environmental benefit, and dual environmental-economic benefit.

HDL, too, got consent. However, notwithstanding purported anxiety about security of supply for West Coast, energy efficiency and so on, the HDL proposal has been challenged by Meridian, and appealed by Solid Energy (read more here and here). Solid initially said the hydro would obstruct the coal; now, it has its own, allegedly plagiarised, counter-proposal.

Capacity-wise, it seems that the HDL and Arnold proposals combined would be capable of generating at least as much power as Mokihinui, if not more. If all three proceeded, transmission infrastructure might struggle to cope. And Solid Energy’s newly knocked together Stockton proposal is, procedurally, a long way behind HDL’s.

So what is this about? It’s not about 'greenies' being anti-development: the HDL and Arnold schemes are backed by the same pro-conservationists who are anti-Mokihinui. Everyone agrees the West Coast needs security of power supply, and an efficient, clean supply.

This is about a couple of state owned enterprises, wanting to capture the market and protect their position — anti-competitive behaviour, in other words — at the expense of the environment.

For Solid Energy, this is nothing new; the best criticism I can level at them is lack of original thought. But this goes to the heart of Meridian’s brand, because, as a number of people have said, it’s not renewable energy, if you trash irreplaceable things to make it.

It goes to the heart of the government’s brand, too. Shareholding Ministers, who help write corporate statements of intent under the State Owned Enterprises Act, have apparently no recollection of their colleague Nick Smith’s earlier bluster — because that’s what it must be. (Do we believe Matthew Hooton? “To say that Nick Smith is a National Party Minister is ridiculous. He may well be in the National Party but … I don’t think anything that Nick Smith has done can be fairly attributed to the National Party”Nine to Noon, May 3, 2010. Or do we think he was sounding like a bit of a dick that day?)

These resource consent proceedings predate the government’s flagship Resource Management (Simplifying and Streamlining) Amendment Act. You might expect government policy to be consistent, though, whatever the formal legal position. When that Bill was read for a first time, responsible Minister Nick Smith said: “It provides restrictions on anti-competitive appeals motivated by trade competition …”. He went on, to talk about costs and delays caused by anti-competitive objections, referring to the supermarket wars that drive up the cost of ordinary peoples groceries, and the importance of facilitating infrastructure decision-making.

Hello? Anyone home?

John Key says Nick Smith’s brain is the size of the South Island. I would swear I heard someone on the Labour crossbenches musing aloud that day about whether it might be as sparsely populated — but unless the wiring in there is as screwy as transmission to the West Coast, Smith, at least, must have joined the dots.

Here we find Smith again, talking sternly to DOC about the importance of “a greater degree of transparency in agreements reached over resource consents”. Contrast that with reports that Meridian’s been buying off objections, again; it was the recipient iwi that disclosed the payment; Meridian confirmed it, but declined to say how much.

And, when he says it makes no sense for the taxpayer to pay for different lawyers representing different parts of the government arguing different sides of the debate”, how does it serve the taxpayer exactly, for Meridian to battle on with Mokihinui consents, in the face of quite clear signals that they would not get the DOC dispensations that they need?

When Solid Energy turns on HDL’s private initiative, does no one round the Cabinet table ever stop to ask themselves why private competition for the corrections department is such a blessed thing, and yet apparently not, for power generation?

Does the government have its head so deeply buried in the ‘balancing environment-economy’ paradigm, that they think you can’t ever achieve one without sacrificing the other, against all the evidence, in this specific instance, that you can?

Or is it just a plain old policy shambles, that doesnt serve New Zealand’s or West Coasters' best interests (or the snails’, by the way, because the poor buggers are in the way again)?


So what is this about? It’s about something very simple in the end: bad government, because whatever you think about the merits of their policy, it seems they can’t even manage to apply it.