Transcript We want to set up a joint business/government taskforce

A clean economy vision for 2025
NZ cleantech/greentech presentation
to Hon. Bill English 2 Dec 2009
Executive Summary
New Zealand's economy is lagging (it is behind Australia) and a change
in focus is required just to catch up.
An economic accelerator with great potential to do this is the
development of a cleantech/greentech economy.
This is a fast growth, sustainable opportunity for our economy that has
strong alignment with the NZ brand and quality of life.
We are a group of business leaders who want to develop a strategy to
grow NZ's clean, green economy.
We are going to go public with our plans, and invite the Government to
join us.
We are a group of NZ business leaders who believe NZ needs a
game-breaking strategy to reverse its fall down the OECD ladder.
We think a cleantech/greentech economy offers the solution.
We are a group of NZ business leaders who believe we
need a game-breaking strategy if we are to have a
serious chance of catching up with Australia in a way
that is politically achievable and palatable to the NZ
public. A strategy would focus our efforts.
The cleantech/greentech sector is likely to drive the
world’s next big economic wave, is well-aligned with
brand NZ and our comparative advantages, has huge
cost-saving potential and will present a compelling long
term strategy to the NZ public.
We met with the Prime Minister in September regarding
this initiative. He was very enthusiastic, gave us a
considerable amount of time, and agreed to further
substantive meetings with his advisors.
Our group has grown significantly since then – mainly
by word-of-mouth. This idea seems to excite even the
most conservative business people. We are planning
to go public with our ideas, and wish to do this in
partnership with the government.
“Unless we get a
good view of what is
possible for New
Zealand, we will
continue to dissipate
energy and activity in
minor matters.”
John Allen
The group includes Rob Fenwick, George Fistonich,
Rob Fyfe, Phillip Mills, Jeremy Moon, Geoff Ross and
Stephen Tindall.
Not only is it a $150 billion per annum opportunity, the clean
economy builds on New Zealanders’ core values. This makes it a
politically and socially palatable solution to achieving parity with
Australia and an enhancement to existing successes.
A $150 billion high value, low carbon export
economy by 2025.
We want to develop, commercialise and deploy clean
technologies and smart thinking to transform existing
sectors and create dynamic new ones.
Clean technologies (or cleantech) are products and
services that improve performance, productivity or
efficiency while reducing costs, raw materials, energy
consumption and waste streams.
The clean economy is an economic vision for New
Zealand that recognises the global reality of a world
that is resource constrained and carbon restraining.
The clean economy is one of wealth creation based on
five foundations: clean energy, clean transport, clean
industry, clean agriculture and clean environment.
These values fit with what is important to New
Zealanders - namely quality of life, quality of
environment and social equity.
“New Zealanders choose to
be poor. We believe that we
have a clean economy and a
clean green image, and do
not see the lack of honesty
which surrounds this
branding. We are merely a
small population spread
over a large area which
provides an impression of
clean and green.”
Prof. Sir Paul Callahan
This can be changed! Through cleantech it
is possible to achieve economic growth,
while having an authentic clean green
economy to support our national brand.
With government agency expertise, some independent advisory
assistance and our own proven ability to commercialise, we can
offer a major win for the NZ economy.
In 2025, NZ is …
• the location of choice for delivering large scale clean
technology and green technology innovation
2025
• capable of delivering all parts of a large scale clean
energy project
$150
billion
• capable of global distribution of clean energy
• an economy with diversified sources of creativity,
industry, finance and entrepreneurship
2020
• supporting a mix of fee-for-service activity and
ownership in clean energy solutions
Invested in INFRASTRUCTURE: to increase domestic
competitiveness,and energy independence.
• the home of world-class ‘star’ companies across all
the main sub-sectors of the cleantech/greentech
economy
• differentiated from its competitors through leadingedge technological innovation and creativity
 New Zealand’s cleantech/greentech sector is
profitable, self-sustaining and world-class.
2015
Invested in CAPITAL: to leverage success into ownership opportunities
for NZ firms delivering foreign energy and green sector solutions
Invested in CAPABILITY: to increase business capability,
educational alignment & international connectivity
2009
We want to set up a joint business/government taskforce to
fully explore the opportunities and quantify the benefits of a
cleantech/greentech strategy for New Zealand.
This is the crux of our proposal - that we set
up a joint business/government taskforce to
fully explore the opportunities and quantify
the benefits of a cleantech/greentech
strategy for NZ.
We are confident that a net economic
benefit analysis will show that the revenue
benefits will far out weigh the costs, which
seem to be the sole focus of current
dialogue in NZ and many other countries.
Energy security and
independence
Continued market
access and
competitiveness;
maintenance and
strengthening of the
NZ Inc brand
Proactive response
to climate change
The most immediate and tangible benefits
will likely fall under the following four
strategic imperatives.
New industry
development by
exploiting the
cleantech window of
opportunity
The opportunities for cleantech and greentech are multifaceted
and benefit the economy in a variety of ways.
1
Develop/commercialise
clean tech and/or
import cleantech
2
Deploy
cleantech
Industry
and
Exporters
Primary
Sectors
3
Build viable long
term platform for
sustainability
Country
as whole
Earn Clean Image
+ strengthen NZ Inc
brand
4
Leverage sustainability;
brand, knowledge and
leadership position
Higher value
Products
Integrated
Economy
Sustainability
Solutions
Efficiency +
competitiveness
Process
efficiency +
higher value
chain
Resource +
energy +
brand
We have identified four pillars upon which the strategy rests:
export driven growth, leveraging NZ’s brand, cost savings and
risk mitigation.
Cleantech/greentech – a large, sustainable contribution to NZ’s economy
1. Unlock
$150bn of
new export
revenues
2. Strengthen
and leverage
NZ’s brand in a
way that
complements
existing
successes
3. Generate
cost savings
for the whole
economy
4. Risk
mitigation
through
resilience and
energy
independence
1. Clean tech provides much-needed opportunities for growth
and we need to export smarter!
To sustain even a modest standard of
wellbeing, it is important that New
Zealand exports. Its own population is
too small to generate sufficient returns
for re-investment in world class
production development.
There is potential to increase exports:
•Only 50 companies have export
earnings over $50m.
•There were 36,000 exporters in 2008,
less than 10% of the 476,000
enterprises in New Zealand.
• Of the 36,000, 50 exporters
accounted for 60% of total export
revenue.
• Although the there is a diverse
range of export products, over 50% of
exports come from just 3 product
groups (dairy, tourism and meat).
• Only 5 countries make up the
destinations for 50% of New Zealand
exports (Australia, USA, Japan, China
and the UK).
1. Clean Tech Provides much-need Opportunities for Growth
(cont.)
By gaining early mover status in the cleantech wave
and managing this in a way that ensures the returns
from this are retained with New Zealand-based
business developers, there is considerable potential to
dramatically grow this export base.
Any of these has the potential to double our national
energy generation. Add to this other forms of
renewable energy including wind turbines and
cleantech will generate even more opportunities for
commercialised business development.
It can be grown in a way that as well as increasing
export returns, will further diversify markets, products
and customers, providing a more sustainable foreign
exchange base.
NZTE has identified hundreds of export opportunities in
cleantech, including several that are worth in excess of
$10 billion per annum. With the right regulatory
framework, we believe local and international
entrepreneurs will create thousands more
opportunities.
The result of this, based on projects done by NZTE, is
a move to become a high-value economy, generating
high quality employment opportunities in the "new
manufacturing" based around innovation.
Relative to many countries, New Zealand has a number
of natural assets to capitalise on including:
- thermal energy
- forestry waste (methanex)
- tidal power (Cook Strait project)
In short, cleantech/greentech is our chance to
maximise new, high-value export opportunities.
2. Protecting and strengthening NZ Inc brand
The previous pillar (maximising new export revenue
opportunities) doesn’t mean replacing our biggest
existing industries with new ones. Our three biggest
exporters are milk, tourism and meat, all of which are
driven by the 100% pure image. There are tremendous
synergies/opportunities here for farming, wine, forestry,
etc, both in terms of developing new technologies and
adding value through differentiation.
New technologies can occur in areas including milkprocessing, stock feeds and carbon farming that have
the ability to earn ETS credits and simultaneously add
perceived value to our products.
Consumer research shows, for example, that 28% of
US consumers rate clean, green products highly and
are prepared to pay significantly more for them. This
market, however, has an impression that we “know our
cows’ names and milk them individually by hand”. This
is very sensitive to negative publicity.
Inaction will not only prevent new opportunities
but erode existing successes.
Many of our group of business leaders are exporters
who are being blocked out of UK supermarkets over
the food miles debate right now and who are highly
concerned by NZ’s vulnerability to instances like the
Guardian articles. The risks of not adopting our
strategy, or worse still – from doing nothing around the
growing perception that we are dragging our heels on
this issue - are untenable.
3. Cost Savings – reduced energy costs gives our whole economy
a competitive advantage
We have a huge challenge ahead with both the
government and export deficits. Unless we dramatically
improve resource efficiency our economy is likely to
risk severe constraints in the near future from
escalating commodity costs.
NZ has tremendous ability here to increase efficiency
e.g. EECA study shows that we can reduce energy
use by 40%, much of this in simple areas like
replacing archaic transmission lines. A
Meridian/Contact Energy study shows that we could
save $8B at today’s prices by moving to electric cars.
There are currently only 1 billion people at first world
consumer status, using 80% of the world’s resources –
the growth of the emerging economies is likely to see
that number increase by 2-3 times over the next few
decades and there are no more resources available.
Virtually every businessperson we talk to has stories
of the huge cost savings they have made by reducing
their carbon footprint.
Costs will spiral and if we do not reduce our resource
cost exposure e.g. become energy independent, we
could be destroyed by e.g. $300-450-a-barrel oil. With
that comes a paradigm shift and our distance from
markets will prevent our ability to compete .
These increased efficiency measures are working for
businesses. If we take those same steps as a country,
we can all reap the benefits of cost savings over the
long term.
4. Risk Mitigation – we don’t have to be vulnerable anymore
If NZ could provide for its own energy needs through
low-emissions, low cost per MWh electrical energy
production, we would have a very cost-competitive
proposition – a competitive advantage for a variety of
industries when compared with other nations.
This will be increased through the advancement of
penalties for the carbon economy, which we would be
well positioned to avoid.
We would be energy independent – no longer
vulnerable to the costs of a barrel of oil as driven by
forces beyond our control. Developing electric railways,
electric buses and trams, electric cars and motorbikes,
all hooked up to NZ’s clean energy smart grid would
offer us long-term, low impact energy solution.
As international compliance costs and penalties
attached to being seen as a free-rider increase the
economic consequences would be untenable.
However, the big risks that will materialise if negative
ecological scenarios eventuate , for example, even a
small rise in sea-levels, would not only cost us billions
but alter the fabric of our way of life.
We would want to have as many friends as possible in
the events that would follow sustainability-based
economic upheaval or climate-change driven threats.
We will commit resources and time to this project. We call upon
government to do the same.
Our proposal is to set up a business/government
cleantech growth taskforce that would call on the
assistance of NZTE, MED, Treasury, MORST and
FORST and of business-savvy economic and
financial consultants.
We need the assistance of central agencies and some
top-up resourcing for an in-depth business strategy
based on economic and financial analysis to maximise
the realisation of benefits.
The committee would include top Kiwi exporters like
Rob Fyfe that fit the cleantech profile, a top
international cleantech entrepreneur like Vinod Khosla,
a Kiwi financier in the sector, a leading global
economist such as Joseph Stiglitz, and top government
officials. Aims would be to identify the biggest
opportunities, conduct net economic benefit analysis
and recommend strategies for implementation and
optimizing the benefits to NZ. It would be jointly funded
by business and government with a government
commitment to act on the results.
We would aim to go public with the initiative over the
holiday period. This will be the positive story that the
public has been waiting for from this government. It
will offer us a once-in-a-lifetime chance to transform
our economy and become a progressive, prosperous
and globally respected country.
Conclusion
We can catch up.
An economic accelerator with great potential to do this is the
development of a cleantech/greentech economy.
This is a fast growth, sustainable opportunity for our economy that has
strong alignment with the NZ brand and quality of life.
We want your assistance to form a taskforce of business leaders and
government leaders - to develop a strategy to grow NZ's clean, green
economy.