Estimates of appropriations

Vote Energy - Estimates of Appropriations 2008/09 - Estimates 2008/2009

Note 8

From the Estimates of Appropriations 2008/09 in Budget 2008, Vote Climate Change and Energy Efficiency was renamed to Vote Climate Change as the energy efficiency appropriations were transferred to Vote Energy.

MINISTER(S) RESPONSIBLE FOR APPROPRIATIONS: Minister Responsible for Climate Change Issues (M12), Minister for Economic Development (M25), Minister of Energy (M28)

ADMINISTERING DEPARTMENT: Ministry of Economic Development

MINISTER RESPONSIBLE FOR MINISTRY OF ECONOMIC DEVELOPMENT: Minister for Economic Development

Overview of the Vote#

The Minister of Energy is responsible for appropriations in the Vote for the 2008/09 financial year covering the following:

  • a total of just over $29 million for policy advice on the operation and information disclosure of energy resource markets, management of the Crown mineral estate, administration of the gas, electrical safety and measurement and energy efficiency regimes, implementation of the New Zealand emissions trading scheme and associated emissions unit register, and provision of information on stock and flow levels of the energy and minerals sectors
  • a total of just under $98 million for the Electricity Commission's work in regulating the electricity system, securing reserve energy supplies for New Zealand now and into the future, and promoting electricity efficiency
  • a total of just over $39 million for the Energy Efficiency and Conservation Authority's work in promoting energy efficiency, including by providing grants and assistance
  • a total of $65 million over five years for variable costs relating to maintaining a secure supply of energy for New Zealand; note that in the event of the Whirinaki power station operating, these costs are normally recovered from the sale of the resulting electricity
  • a total of $16 million for the operating, maintenance and depreciation costs relating to the Whirinaki power station
  • a total of $10 million to manage and fund New Zealand's oil stocks obligations with the International Energy Agency
  • a total of just under $8 million for the Commerce Commission's work relating to enforcement services in the general market for energy
  • a total of under $1 million for international membership fees and to meet Ministry of Energy residual liabilities, and
  • a total of just under $8 million over four years for the deployment of marine energy devices.

Details of these appropriations are set out in Parts 2-6 for Vote Energy in the Information Supporting the Estimates of Appropriations.

Details of Appropriations#

Details of Annual and Permanent Appropriations

Details of Annual and Permanent Appropriations - Energy
  2007/08 2008/09
Titles and Scopes of Appropriations by Appropriation Type Budgeted
$000
Estimated
Actual
$000
Budget
$000

Departmental Output Expenses

     

Administration of Gas, Electricity and Energy Efficiency Regulations and related Acts (M28)

This appropriation is limited to the purchase of advice on administration and associated policy work, Ministerial servicing and decision support for the Minister in relation to, and the administration of the regimes for: gas and electricity safety; energy efficiency and conservation; the supply, quality and measurement of gas and electricity; fuel quality monitoring; and information disclosure.
- - 5,609

Emissions Trading Implementation (M12)

This appropriation is limited to the implementation and administration of the New Zealand Emissions Trading Scheme.
3,312 1,912 4,984

Energy and Resource Information Services (M28)

Provision of information and technical advice on energy and resources, the management of the response to any international disruption in oil supplies, and the management of New Zealand's energy-related international relations.
1,646 1,440 1,328

Administration of Gas and Electricity Regulations (M28)

Advice on the administration of the gas and electricity safety and associated policy work and administration of regimes on supply, quality and measurement for gas and electricity safety; petroleum quality monitoring; electrical worker licensing; and information disclosure for the gas industry.
5,107 4,741 -

Energy and Resource Information Services RDA (M28)

Provision of information and technical advice on energy and resources, the management of the response to any international disruption in oil supplies, and the management of New Zealand's energy-related international relations.
1,027 1,027 1,227

Management of the Crown Mineral Estate (M28)

Allocation and management of Crown-owned petroleum, coal and mineral resources under the Crown Minerals Act 1991 and minerals programmes issued under the Act.
10,231 10,204 8,114

Policy Advice on Energy and Resource Issues (M28)

This appropriation is limited to the purchase of policy advice, ministerial servicing, and decision support for the Minister in relation to the operation of energy and resource markets (electricity, oil, gas, geothermal, coal, minerals and related natural resources) and energy efficiency and conservation issues, including Treaty of Waitangi issues in relation to natural resources in particular mineral and energy resources. It also includes purchase of ownership and purchase advice on Crown entities.
6,027 5,687 6,443

Provision of Climate Change Unit Register and Information (M28)

This appropriation is limited to services relating to the operation of a register to enable the allocation and trading of climate change units under the Climate Change Response Act 2002.
1,456 1,415 1,456

Total Departmental Output Expenses

28,806 26,426 29,161

Non-Departmental Output Expenses

     

Control of Natural Gas Services (M28)

For development of input methodologies under Part 4 of the Commerce Act 1986 and the costs of administering the Commerce Act 1986 Part 5 control regime over the gas pipeline services of Powerco and Vector.
2,181 2,181 503

Electricity Governance and Market Operations (M28)

Funds the Electricity Commission's major functions as the regulator for the electricity system. It also covers core electricity system and market operation functions, carried out under service provider contracts.
49,043 49,043 49,043

Energy Efficiency and Conservation MCOA (M28)

- - 38,235
Electricity Efficiency
This output class is limited to:- conducting electricity efficiency research, and- development and administration of programmes that provide incentives for cost-effective energy efficiency and conservation, aimed at changing market behaviours.
- - 18,401
Energy Efficiency and Conservation
This output class is limited to operational and policy outputs in accordance with statutory functions under the Energy Efficiency and Conservation Act 2000 and the government's energy strategies.
- - 19,834

Enforcement of Electricity Sector Regulation (M28)

For the provision of development of input methodologies under Part 4 and 4A of the Commerce Act 1986, the review of asset valuation methodologies, collecting and disclosing information, assessing performance against thresholds and implementing price controls as necessary in relation to electricity lines businesses and Transpower.
5,578 4,974 7,117

Maintenance and Operation of Whirinaki (M28)

Largely fixed operating and maintenance costs for Whirinaki power station including the Contact Operating and Maintenance contract, depreciation on the plant and obligations arising under the Reserve Generation Capacity Agreement.
33,500 33,000 16,000

Management of IEA Oil Stocks (M28)

For the cost of managing and funding of oil stocks to meet International Energy Agency obligations.
22,000 9,358 10,000

Reserve Energy and Emergency Measures?Availability Costs (M28)

Funds the cost of having reserve electricity capacity and capability available, including:1. tendering for reserve energy and emergency options; and2. ensuring availability of reserve energy capacity.Does not include cost of supply of reserve energy (fuel) or implementation of emergency measures.
29,981 26,645 29,981

Acquisition of Petroleum Exploration Data - Extension (M28)

To fund the acquisition of seismic data in New Zealand's offshore petroleum basins.
2,934 2,934 -

Electricity Efficiency (M28)

The performance of electricity efficiency functions appropriation covers:1. conducting electricity efficiency research; and2. development and administration of programmes that provide incentives for cost-effective energy efficiency and conservation, aimed at changing market behaviours.
13,074 9,152 -

Total Non-Departmental Output Expenses

158,291 137,287 150,879

Non-Departmental Other Expenses

     

Electricity Commission Litigation Fund (M28)

Funding to ensure that the Electricity Commission is able to participate in litigation effectively and without delay.
444 444 444

Energy Efficiency and Renewable Energy Grants and Assistance (M28)

This appropriation is limited to the Crown's contribution to fund improvements to the energy efficiency of New Zealand businesses and homes (with a particular focus on the homes of low income earners); and to develop the solar hot water industry.
- - 19,300

International Energy Agency Contribution (M28)

Payment of contributions towards the cost of energy-related research undertaken by the International Energy Agency.
50 42 50

International Energy Agency Subscription (M28)

Payment of annual subscription for membership of the International Energy Agency.
150 130 150

Ministry of Energy Residual Liabilities (M28)

Payment of residual liabilities of the former Ministry of Energy and to meet urgent mine restoration and rehabilitation relating to the operations of the state coal mines prior to 1987.
199 199 199

Total Non-Departmental Other Expenses

843 815 20,143

Non-Departmental Capital Expenditure

     

Crown Energy Efficiency (M28)

This capital expenditure appropriation is limited to provision of funding for the Crown loans scheme to assist public sector agencies in implementing energy efficiency projects.
- - 2,000

Total Non-Departmental Capital Expenditure

- - 2,000

Total Annual and Permanent Appropriations

187,940 164,528 202,183

Multi-Year Appropriations#

Multi-Year Appropriations - Energy
Type, Title, Scope and Period of Appropriations Appropriation $000

Non-Departmental Output Expenses

   

Generating Reserve Electricity At Whirinaki (M28)

To cover Whirinaki non-operating and maintenance security of supply costs; predominantly expected to cover fuel supply in the event that the plant is required to generate reserve electricity.

Commences: 1 July 2004

Expires: 30 June 2009

Original Appropriation 16,000
Adjustments for 2006/07 26,191
Adjustments to 2007/08 (39,045)
Adjusted Appropriation 3,146
Actual to 2006/07 Year End 3,146
Estimated Actual for 2007/08 -
Estimated Actual for 2008/09 -
Estimated Appropriation Remaining -

Generating Reserve Electricity At Whirinaki (M28)

To cover Whirinaki Reserve Energy Plant security of supply costs, excluding those covered by the annual appropriation entitled Maintenance and Operation of Whirinaki. Predominantly expected to cover purchase of fuel against the event that the plant is required to generate reserve electricity.

Commences: 1 July 2007

Expires: 30 June 2012

Original Appropriation 49,045
Adjustments for 2006/07 -
Adjustments to 2007/08 9,956
Adjusted Appropriation 59,001
Actual to 2006/07 Year End -
Estimated Actual for 2007/08 6,394
Estimated Actual for 2008/09 10,000
Estimated Appropriation Remaining 42,607

Reserve Energy and Emergency Measures - Variable (M28)

To cover Electricity Commission costs relating to the 1) net variable operating costs of the Whirinaki Reserve Energy Plant when used to provide reserve energy, and 2) implementation of emergency measures.

Commences: 1 July 2007

Expires: 30 June 2012

Original Appropriation 5,000
Adjustments for 2006/07 -
Adjustments to 2007/08 1,000
Adjusted Appropriation 6,000
Actual to 2006/07 Year End -
Estimated Actual for 2007/08 -
Estimated Actual for 2008/09 1,000
Estimated Appropriation Remaining 5,000

Security of Supply - Procurement Costs (M28)

To implement emergency options if needed, including the purchase of demand side management and reserve energy production (fuel for the Whirinaki Plant).

Commences: 1 July 2004

Expires: 30 June 2009

Original Appropriation 16,000
Adjustments for 2006/07 (13,333)
Adjustments to 2007/08 (2,667)
Adjusted Appropriation -
Actual to 2006/07 Year End -
Estimated Actual for 2007/08 -
Estimated Actual for 2008/09 -
Estimated Appropriation Remaining -

Non-Departmental Other Expenses

   

Contestable Fund for Deployment of Marine Energy Devices (M25)

Contestable fund for marine energy generation and associated administration costs.

Commences: 1 July 2007

Expires: 30 June 2011

Original Appropriation 8,000
Adjustments for 2006/07 -
Adjustments to 2007/08 (495)
Adjusted Appropriation 7,505
Actual to 2006/07 Year End -
Estimated Actual for 2007/08 1,000
Estimated Actual for 2008/09 1,885
Estimated Appropriation Remaining 4,620