Concern is growing internationally that the global energy transition is not moving fast enough to curb global temperature rises and more needs to be done. Scaling the use of New Zealand’s rich renewable resource is vital to our decarbonisation efforts and the pace of construction will need to accelerate dramatically if we are to meet demand for electricity and green hydrogen.
New Zealand has excellent conditions for offshore wind, and coupled with focused investment and support, the industry holds the potential to yield substantial benefits for the country.
The National Impact Study (NIS) sets out the benefits, costs, opportunities and challenges associated with establishing an offshore wind industry in New Zealand. It has been prepared to inform and advance a national discussion on the merits of offshore wind and to support investment planning, industry coordination, policy and regulatory development.
At a glance:
Economy
Offshore wind presents a pivotal opportunity for steering the country towards a more sustainable economic future, with potential Gross Domestic Product (GDP) estimates ranging from $12 billion to $94 billion over project lifetimes, half of which is expected during construction. Some 5,000 to 30,000 jobs could be supported over the peak construction phase, sustaining economic activity and specialist skills in regions most affected by the energy transition, such as Taranaki.
Environment
Offshore wind stands as a crucial factor in expediting and scaling renewable energy to fulfil our national 'net zero' emissions target by 2050. With its potential to support large-scale electrification and decarbonisation of hard-to-abate transport emissions with hydrogen based power to liquids (PtL) fuels, it could be strategically important to our energy transition.
Our estimates suggest that development of an offshore wind industry could support an 18% to 30% reduction in national energy-related emissions.
While New Zealand can look to overseas precedent, there is a lot that we don’t know about how our native flora and fauna will be affected by offshore wind. Detailed environmental studies are required to understand how New Zealand’s unique sea life and oceanic and atmospheric conditions will be affected and mitigations designed where needed.
Energy
Offshore wind presents several strategic advantages that position it as an important component of our future energy mix. It has the lowest emissions intensity of all renewable generation options and harnesses a powerful ocean wind resource - uninterrupted by land features - generating more power, more often. Its potential to accelerate and scale renewable energy production may prove critical in keeping ahead of our net zero ambitions. Moreover, offshore wind could contribute to our energy security by offering diversity of supply and higher levels of energy generation during winter and dry periods.
As with other renewable technologies, the cost of offshore wind is projected to fall rapidly with improvements in technology, global manufacturing scale and understanding of the offshore resource. Based on international studies, we estimate the cost of a typical New Zealand offshore wind farm will fall to around the current cost of onshore wind by 2050.
People
Offshore wind farms are anticipated to have a positive impact on communities and iwi by fostering economic activity and creating green energy-related employment opportunities. While communities near proposed offshore wind farms may have concerns about environmental, visual, and noise impacts, offshore wind typically has lower visual and community impacts, as well as reduced land use constraints, given its distance from heavily populated areas.
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