Scoop: Parker: Climate change and the future of the car

What a wind-bag ?!

Scoop: Parker: Climate change and the future of the car

Hon David ParkerMinister of Energy Minister responsible for Climate Change issues
23 March 2007
Speech notes
Climate change and the future of the carAddress to the NZ Automobile Association Annual Conference9.30am, 23 March 2007, Wanganui Room, Wanganui Race Course.
I am delighted to be here today to talk to you about climate change and the future of the car.
Firstly, though, I would like to discuss ‘pioneering’.
New Zealand’s Automobile Association has long been a pioneer in motor transport.
Indeed, in many ways the AA was ahead of its time when it was founded in 1903, the very same year that Henry Ford incorporated the Ford Motor Company.
Few believed AA founder, Dr George Thomas Humphrey, when he proclaimed that the motor car would replace the horse. He was a pioneer.
Today’s pioneers travel a different road, but the chief characteristic they require remains the same: a talent to see and seize opportunities.
Today I challenge you to continue in the spirit of your founder. I challenge you to travel the new road in a carbon-constrained world. A world that places high emphasis on the concept of sustainability.
So what does sustainability actually mean? In essence it means meeting the needs of our communities without compromising the wellbeing of future generations.
Being truly sustainable as a nation requires each of us to play our part.
I think this fits nicely with the theme of your conference. Everyone has a role to play in addressing environmental challenges such as sustainability and climate change.
The government cannot do it alone. In fact it requires many people in many organisations taking many small steps. It requires partnership. It also requires us to think differently about the resources we use and to recognise that these resources are not limitless.The Prime Minister laid out the challenge New Zealand faces at the opening of Parliament last month, when she called for New Zealand to aspire to become the first nation to be truly sustainable. I quote:“New Zealand's future is dependent on long term sustainable strategies for our economy, society, environment, culture and way of life. Those strategies have to be driven by strong leadership and sound policies.”She ended by saying:“Building a sustainable nation requires smart, active government working with key stakeholders across the economy and society.” Today I’d like to focus on what this means for the future of the car, and in particular for the AA as a leading authority in the transport sector. I am going to pay particular attention to the issue of climate change.So all in all there are five main areas I will concentrate on.
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- First, I would like to talk about the forces driving urgent change in the motoring sector.
- Second, the future of the car.
- Third, government leadership.
- Fourth, wider transport initiatives.
- And lastly, I will speak about partnership between the government and the AA as a leading authority in the transport sector.
Forces driving urgent change - climate change and the environment
Climate change has become one of the most compelling issues of our time. The Prime Minister has put climate change at the heart of New Zealand’s sustainability drive by putting us on a path towards carbon neutrality.
Our shift to carbon neutrality is a proactive response to a changing global landscape. Global regulatory and market forces are dramatically altering the transport industry. These are driven, in part, by a growing public demand for action on climate change.
There are several aspects I will mention in regard to this.
First, there is increasing likelihood that there will be an international cost attached to greenhouse gas emissions.
This cost does not arise from the Kyoto Protocol, or any other international agreement. The cost is not huge, and it arises from the cost of changing behaviour in order to reduce emissions – of doing things differently tomorrow from the way we do them today.
One way of internalising the cost of emissions is through emissions trading.
Emissions trading is already underway in Europe.
It's also gaining momentum in the United States and Australia, the only developed countries that have not ratified the Kyoto Protocol.
Australia's state and territory leaders announced last month that they will introduce a national carbon emissions trading scheme by 2010, if the Federal Government fails to set up its own scheme.
Second, pressure from consumers coupled with concerns over energy security, is driving changes in the international vehicle and fuel industries.
Automotive manufacturers are developing more energy efficient cars, as well as vehicles that can run on a variety of fuels such as biofuels, electricity and hydrogen.
In New Zealand, public pressure for action is growing.
Earlier this month an independent poll of 1,000 New Zealanders showed that around a third of consumers are making environmentally-driven decisions about what they buy.
This figure is up 6 percent from the first research poll in 2005. Concerns for our climate are now widespread.
The research also showed that 83 percent of people surveyed were aware of problems such as climate change and want action taken to reduce those problems. This figure is up from 68 percent.
More generally, people are concerned about the environmental degradation of our planet, including pressure on its limited resources, especially the ability of the environment to cope with pollution.
It’s a fact that these factors are driving changes in the New Zealand motor industry and we need to keep up with the pace.
I believe we have a window of opportunity to act on climate change and although there will be costs, there will also be opportunities. Our potential to mitigate these costs and leverage these opportunities, is directly related to whether we face this challenge and take action now.
The future of the car
This brings me to the future of the car.
The trend, is for vehicle manufacturers to respond to concerns about oil security and climate change.
Car manufacturers are increasingly developing more fuel-efficient vehicles and also vehicles that utilise biofuels and electricity.
Some countries require producers to meet increasingly stringent fuel economy targets and New Zealand as an importer will benefit from this.
Most people are familiar with hybrid vehicles that have petrol engines working with electric motors.
There are also vehicles that can utilise high levels of ethanol instead of petrol common in Brazil and increasingly in the United States as well.
Prototype electric vehicles indicate that a commercial range is not many years away.
To support such transformation to more efficient vehicles and higher use of Biofuels, we need appropriate policies and support mechanisms. And I encourage you to think about your role in this area.
We need input from consumer groups like the AA to help us make the most of these developing technologies.
I hope to establish an advisory group to the government at assist us in this area.
Government leadership
Having now provided you with the wider context of international issues relating to climate change and the response of the vehicle manufacturing industry, let me turn now to the government’s role and response.
We are leading by example and moving towards carbon neutrality in the public sector. This year, all core government departments will begin to reduce their emissions.
And six departments will achieve carbon neutrality by 2012.
Over the next few years, all other government departments will follow in their footsteps and learn from their example.
The groundwork for putting this plan into action has already been done.
Here are a couple of positive examples of government departments that have reduced their emissions, and operating costs, by cutting transport, energy use and waste.
My first example is the Inland Revenue. They saved $36,000 by using fuel-efficient vehicles and running a shuttle bus service between Wellington buildings.
Second, the Ministry of Transport is currently reviewing 11,000 vehicles across 21 government departments. They aim to identify savings opportunities in carbon dioxide, fuel use and cost.
And third, savings of over $500,000 and carbon dioxide emissions reductions of 550 tonnes, are expected over the next three years through changes to the parliamentary fleet.
As well as contributing to emissions reductions, these moves are also part of the government’s drive to flex its purchasing power by demonstrating a clear preference to procure sustainable goods and services, while maintaining the best value for money.
By changing its purchasing patterns, the government will drive changes in the wider business and consumer vehicle markets.
Wider transport initiatives
The fourth area I will cover is the context of recent discussion documents that are currently out for consultation.
The government released a draft Energy Strategy and a draft Energy Efficiency and Conservation Strategy, late last year.
These documents provide a basis for robust discussion about our energy future, including transport.
These documents also highlight concerns around climate change and the end of cheap oil.
Reversing the upward trend of transport emissions will be a challenge. Under a business-as-usual scenario, greenhouse gas emissions from transport are projected to increase by 35 percent, by 2030.
In New Zealand we have a relatively high level of car ownership, low use of public transport although this is increasing, dispersed cities and rugged terrain.
These circumstances provide opportunities and challenges. Transformation is required in every sector.
Actions to curb our dependence on oil and reduce emissions are set out in the draft Energy Strategy and the draft Energy Efficiency and Conservation Strategy discussion documents.
One of the actions highlighted is increasing our use of biofuels. Soon after the documents were released the government announced a biofuels sales obligation.
By introducing the biofuels sales obligation, which begins next April, we aim to lower our green house gas emissions, decrease our dependence on imported oil, improve energy security and develop a domestic biofuels industry.
The target of 3.4% biofuels by 2012, will reduce greenhouse gas emissions by more than a million tonnes, between 2008 and 2012. Biodiesel from tallow is likely to be the cheapest option, and therefore the first to be developed here.
Another climate change work programme that the Ministry of Transport is working on is the development of a sales weighted target for light vehicles.
Officials are working with industry, on the concept that these should be a requirement for vehicles entering the fleet to meet a ‘sales weighted average fuel economy’ target.
By that, I mean that a car importer will still be able to sell a range of vehicles - some large, some small, some hybrids, new highly efficiency vehicles, and in the future, electric cars. The average fuel economy must meet a target, which will become more stringent over time.
We need to keep the benefit of cheaper second-hand imported cars, but we should also try to ensure we avoid the worst excesses of inefficiency that can come in through completely unregulated second-hand imports.
Such schemes, voluntary and mandatory, are already in place in nearly all of the countries that New Zealand currently imports vehicles from, such as Europe, Japan, and Australia.
I firmly believe it is time that we introduced policies like this in New Zealand.
The second-hand and new vehicle industries are very different and there are a number of data and technical issues to overcome.
We have already started discussing what these targets might mean for New Zealand. And the AA is taking part in these discussions.
I hope that I will be able to say more about this later in the year.
We want to identify the government’s role and also work in close partnership with the industry.
One of the key messages officials have directly fed back to me is that there needs to be a range of tools to reduce emissions.
We have to target the vehicle at fleet entry, in the fleet and the driver of the vehicle.
The work on a sales weighted target focuses on the vehicle at the time it enters the fleet. There will need to be supporting programmes for vehicles in the fleet and also for the driver.
Another programme which I look forward to seeing put in place as soon as possible is fuel efficiency labelling for vehicles at point of sale.
If we already have fuel efficiency labels on appliances like fridges and dishwashers, surely it makes sense to have them on cars.
Such labelling will allow prospective car buyers to easily compare the fuel running costs of vehicles, and will drive the point home, that fuel efficiency equates to money in your back pocket.
We are, therefore, tackling the issue of reducing transport carbon emissions from several angles at once, and I know that the AA endorses this balanced approach.
Conclusion - a call for partnership
And in conclusion I want to emphasise that the path to sustainability requires partnership.
The government will be working closely with households and the business sector, to move New Zealand towards sustainability, through practical actions that make a difference to our economy, our environment, our society and our nationhood.
There is an important role here for the AA. The AA is one of the most trusted, respected and well-known organisations in New Zealand. This makes you not only an authoritative voice on motoring matters but you have the confidence and trust of the driving public as well.
I applaud the work you already do, to educate drivers on how they can maximise the fuel economy of their vehicles, as well as the advice you provide to members on low-emission vehicles.
As an independent and objective voice, your work guides the purchasing and driving decisions of thousands of New Zealand motorists.
I see a dual role for the AA in addressing climate change.
First, you can build on the work you do already in educating drivers on fuel economy. Second, you can help guide New Zealand’s vehicle fleet towards sustainability.
Let me expand on this second point.
The shift towards environmentally-friendly vehicles is gaining momentum worldwide. Being “green” has become desirable.
At the Oscars last month, 30 alternative fuel and electric vehicles, were used to shuttle celebrities to the ceremony. In New Zealand there is growing interest in green vehicles.
As the AA, you have an opportunity to capitalise on this shift. You can stimulate greater awareness of these new vehicles. You can provide a forum for objective debate, on new vehicle types and models. You can educate drivers on the true costs of owning a more efficient vehicle over its whole life.
The AA has already partnered with the government on the shift to more environmentally friendly vehicles.
In September 2006, the AA logo appeared on a sticker, on roughly 3000 used-vehicles that were imported into New Zealand, and had passed a harmful emissions test, as part of a research programme undertaken in Japan for the Ministry of Transport.
The AA provided the quality control, and the credibility for the project which allowed us to take it from a piece of academic research, and turn it into an effective public education campaign.
This joint approach received excellent feedback, and I believe, is an excellent model for how we can work together on other issues.
As I said earlier, we are entering a new landscape. And our power to capitalise on this landscape depends on the fundamental skills of the pioneer – to see and seize new opportunities.
Thank you.
ENDS