Table of Contents
Summarised by Centrist
The government plans to build a new liquefied natural gas import terminal in Taranaki, funded by a compulsory charge on electricity companies, though it has not revealed how much it will cost.
The final amount is expected to flow through to household power bills.
A released Cabinet paper states the government wants to rush approvals ahead of the election “to give the preferred supplier greater policy certainty” and even recommends signing contracts by mid-year to guard against a future government reversing the project.
The political fight this week has focused on what to call it. Labour calls it a “gas tax.” Prime Minister Christopher Luxon says that is “a load of rubbish.” Energy Minister Simon Watts insists it is “neither [a tax nor levy] because it is a net benefit to New Zealand households.”
Luxon refused to reveal the size of the levy while the procurement process is underway, saying only that official advice suggests households will be around $50 a year better off as a result.
“Let me be clear, without doing this, New Zealanders will pay more,” he said.
The government argues the terminal will increase gas supply, reduce the risk of electricity shortages in dry years, and lower wholesale power prices over time. The upfront charge, it says, will be offset by long-term savings.
Labour leader Chris Hipkins said the government “cannot make that commitment,” arguing that if households are charged on their power bills, “it’s going to cost households more money.”
Even coalition partners split on terminology. ACT leader David Seymour said, “it is a levy.” Winston Peters said bluntly, “It’s a tax. This one may of course bring a benefit at the same time.”
