Gas (Market Transparency) Amendment Bill

First Reading Hon SIMON WATTS (Minister of Climate Change) (23:11): on behalf of the Minister for Energy: I move, That the Gas (Market Transparency) Amendment Bill be now read a first time. This bill amends the Gas Act 1992 to introduce a new regulation-making power to improve the transparency of the gas market. The Government is focused on delivering secure, affordable energy for Kiwi households and businesses, and improved gas market information is essential to making that work. Better gas information would support better decision making by market participants and Government, helping to keep the lights on as gas supply tightens. Information on New Zealand’s gas market, including production, consumption, and pricing, is currently fragmented and, in some cases, incomplete or out of date. This lack of good information makes it difficult for gas users and market participants to confidently assess gas availability and make informed decisions about running their business or making investments. Given gas’s ongoing role in generating the electricity if it keeps the lights on when the sun is not shining and the wind is not blowing and the lakes are low, then limitations of gas market information also affect decision making in the electricity market. These limitations make it harder for the Government and others to understand developments in the gas sector and to take timely, effective action to manage the impacts of constrained supply on Kiwi households, businesses, and jobs. Existing information disclosure mechanisms under the Gas Act are too slow, too uncertain, and limited in scope to address the current challenges with the gas market information effectively. This bill responds to these challenges by creating a new regulation power to enable the collection and publication of relevant gas market information. The new power will enable us to do two things: firstly, provide greater information to gas market participants to better inform their decision making; and, secondly, collect information that is just for Government use to better inform decision making on policy. Access to information is increasingly important as New Zealand’s gas reserves and production decline, following the previous Labour Government’s ban on offshore oil and gas exploration. In other words, as gas reserves go down, the need for reliable information goes up. The latest reserves data forecasts a further 15 percent drop in gas production for 2026, compared to last year’s forecast, with total reserves down 23 percent on a year ago, to their lowest levels in 20 years. As supply tightens and the gas market is expected to become more volatile and uncertain, it makes high-quality information even more critical to ensuring market participants and the Government can plan for the future. When gas runs short, power bills go up, batteries shut, and Kiwis lose their jobs. That is exactly what happened in 2024 when wholesale power prices soared above $800 per megawatt hour during a dry year and the aluminium smelter cut production, and some businesses closed for good. Given the urgency of improving the gas market information and the considerable and wide-ranging economic impacts of declining gas supply on business sectors and on the New Zealand economy, I am seeking to progress this bill under all stages today. What we will do after the bill is passed is important. Once this bill is passed, we will develop regulations following consultation with stakeholders to determine what information should be collected and how it will be used. Information disclosure requirements set out in regulations will focus on collecting high-value data for users while taking into account the compliance burden on gas market participants. I expect that both existing and newly published gas market information will be made available in a way that is easy for gas users and market participants to access. This bill is needed to progress these urgent changes to improve gas market transparency and to support our wider work rebuilding New Zealand’s energy security after years of Labour’s neglect. It is all part of our focus on fixing the basics and building the future. I commend this bill to the House. DEPUTY SPEAKER: The question is that the motion be agreed to. Hon Dr MEGAN WOODS (Labour—Wigram) (23:16): Thank you, Madam Speaker. It is my pleasure to take a call after the Minister, speaking on behalf of the Minister, introduced this bill to the House, because, last week, the Government made an announcement: the Gas Transition Loan Guarantee Scheme. It was the Government finally realising that they’d mucked up big time when they scrapped support for industry for transitioning away from fossil fuels and making sure that affordable energy was there for our businesses, and Government was standing shoulder to shoulder with them while they did that. In order to do that, the Government announced that they needed to progress the work on this Gas (Market Transparency) Amendment Bill, to make it clear what the state of our gas reserves were. This is why we have this bill in the House: the Government realising that they needed to make a U-turn on walking away from supporting businesses and go back and continue a programme of work that had started under a Labour Government, when the Government had started a work programme with the Gas Industry Co. to introduce reporting requirements for understanding what the state of our gas reserves were, because what could actually be quite a nice little multipartisan moment—because Labour supports these measures, the Minister decided that he needed to try and be nasty. I think, when he goes through this bill, what he’s going to realise is that the reporting is required because the gas is running out, and the gas is running out because of geology. The gas has been running out for more than a quarter of a century; in fact, it has been 25 years since there has been a commercial find of offshore oil and gas in New Zealand. That is the reality. This is a Government that is refusing to plan for a future without gas. They think that legislating for gas is somehow going to beat the geology, which, the reality is it’s not there. Make alternative plans. It hasn’t been for want of trying. In fact, even after Labour started planning for that transition and ended new exploration permits in 2018, nearly $2 billion was spent on existing permits, looking to seek out additional gas from the existing permit field. Nothing was found. Let’s face facts. Let’s plan for a future where New Zealanders have affordable energy, where our industries know where they’re going—they have a Government that supports them and doesn’t walk away from them for over 2½ years and, with a looming election, think: “We’re going to have to put a band-aid on because we’ve left industry to flounder, we’ve seen industry shut down, and we’ve seen job losses because we have been asleep at the wheel.” That is exactly what has happened under this Government. They have refused to plan and have an energy strategy. They have not progressed work under a gas transition plan, and they certainly have not put in place what needs to be done in terms of the reporting requirements. This was work that could have been progressed well before now, because I think it has been abundantly clear, and certainly the work programme that was started between 2017 and 2023 put in place the framework for introducing reporting requirements around gas. All of this could have been progressed much more quickly. Because I agree with the problem definition that the Minister put in front of us: we do need greater transparency. As our gas reserves fall— DEPUTY SPEAKER: I’ll make the member aware of the time. It’s a five-minute call, but we’re having some technicals with the clock. Hon Dr MEGAN WOODS: OK. Because as we do have dwindling gas reserves, we have to understand what is there so that our businesses can make better choices. But there will be some questions that we have through committee stage. It’s quite a technical bill—we’ve already seen the Minister have to come and do some patch-up with an Amendment Paper that’s been tabled today because it’s hastily drafted legislation despite having 2½ years to do it. We’ll have lots of questions as we progress through. STEVE ABEL (Green) (23:21): Thank you, Madam Speaker. This bill is a striking admission by the most pro - fossil fuel Government in a generation that we cannot trust the oil and gas industry to tell us the truth. We cannot trust the gas industry, number one, because it is an industry that denies climate change. It might say it believes in climate change and then does all the things to show that they don’t believe in climate change. It’s an industry that pollutes the land, the water, the air, the atmosphere, and does it for private property. This bill exists because the gas industry has lied to us about how much gas they actually have in the reserves. Now, for the benefit of Simon Watts, the former Minister for Energy, who has been misleading the country for the whole term—[Interruption] DEPUTY SPEAKER: Just watch the language. But also I’d like this group on the other side to watch the noise because I’m actually having a struggle to hear Mr Abel. STEVE ABEL: Thank you, Madam Speaker. Well, I would say of the people on the other side: they doth protest too much, methinks, because they are so cut by the accuracy of the comments being made, I believe it is within my rights, Madam Speaker, to point out that the Minister has been misleading the country as to the cause of the decline in our gas supplies. For his benefit, his own regulatory impact statement gives us a diagram that shows that gas supplies in New Zealand have been declining since the year 2000. That’s 26 years ago—26 years ago—down, down, down, down, down, down, down. And the ban on offshore oil and gas exploration had no impact on that decline. One of the interesting facts that this bill recognises is that the industry overstates how much gas they’ve got. Why would they do that? Because that is the basis of their value. Here we find in New Zealand that Todd Energy was arguing that there’s plenty of gas available in Taranaki back in 2009. In fact, they said: “There’s plenty of gas. The general assumption is that gas is in decline”—this was in 2009, I might say—“but the assumption is flawed. Remember, it was not that long ago that we were supposed to run out of gas [in] 2010.” He believed known gas reserves would last New Zealand “well beyond 2030”. This is a classic lie from the gas industry because— Simon Court: Madam Speaker, point of order. Madam Speaker, I think it’s unhelpful for the member to suggest that industry participants who contribute information and contribute to this process of developing the bill in good faith have been lying. DEPUTY SPEAKER: Yes, I had warned the member of using his words wisely before, and I would say again that I won’t accept that in the future part of this speech or this debate. Simon Court: Madam Speaker, just further to the point of order. I think it would be, actually, helpful to ask the member to withdraw and apologise to the gas industry. DEPUTY SPEAKER: No, I’ve just asked the member to modify his language. He hasn’t accused a particular person, but I would want him to change his language because I don’t think it’s an appropriate word to be using. Simon Court: Excuse me, Madam Speaker. I don’t want to litigate it— DEPUTY SPEAKER: I’ve ruled; I’ve asked the member to stop using that word. I’ve deemed that it’s not appropriate for him to continue using it. STEVE ABEL: Can I speak to the point of order, Madam Speaker? I believe the gas industry are lying to the New Zealand public. DEPUTY SPEAKER: No. Mr Abel, I’m sorry. I’m going to actually stop your speech now because I’ve asked you not to say that again. Steve Abel: Point of order, Madam Speaker. Can I table a document from the library showing fraudulent reporting by the gas industry from around the world? DEPUTY SPEAKER: Leave is sought for the member to table the document. Is there any objection to that course of action? There is. Steve Abel: Madam Speaker, can I just double check you on this? DEPUTY SPEAKER: No. No, no, I’ve ruled. Mr Abel, I’m sorry. I asked you not to say that word again and I have terminated your speech, and I am— Steve Abel: Point of order, Madam Speaker. Can I ask you to recall the Speaker, please—point of order, Madam Speaker. DEPUTY SPEAKER: No. Don’t trifle with the Speaker. Sit down, Mr Abel, or leave the House. Steve Abel: I ask that you recall the Speaker on you ruling my speech out of order. DEPUTY SPEAKER: Yeah, I am the Speaker. Sit down, Mr Abel. I’m calling on Simon Court to start the next— Steve Abel: Madam Speaker, I believe it’s within my rights to express my freedom of opinion. The gas industry— DEPUTY SPEAKER: Mr Abel, sit down or please leave the House. I’m calling on Simon Court to start his speech. Steve Abel: Outrageous, Madam Speaker. Debate interrupted. Withdrawal from Chamber