Editorial: Green growth potential not to be wasted

Steven Joyce. Photo / APN

Opinion

Renewable energy opportunities should be taken lest NZ slip behind.

In 2004, just over 160,000 Germans held jobs in the renewable-energy sector. Six years later, that number had more than doubled to 370,000. The prospect for the same sort of development here is at the heart of a new report, "Green Growth Opportunities for New Zealand", prepared by the University of Auckland Business School and London consultancy Vivid Economics. New Zealand, it concludes, has many advantages and opportunities in an eco-conscious world but these have yet to be fully realised.

As much is obvious. Despite several reports emphasising the benefits of green investment, New Zealanders have seen little in the way of substance. Few green-collar jobs have been created, and there has been no significant improvement in people's living standards.

Indeed,little has been achieved in the green growth export opportunities identified by the report, notably sustainable agricultural products and services, geothermal energy, biotechnology, and forestry, including second-generation biofuels. Or in opportunities in the domestic economy, such as improvements in building, transport, energy efficiency and electricity grid technology. That shortcoming is certainly not a consequence of a lack of talk about the significant economic and environmental gains if green growth opportunities were exploited. Pure Advantage has been working on the issue for nearly two years.

A key question, therefore, is why these opportunities are not being pursued more vigorously. Pure Advantage has identified three main barriers: a lack of industry co-ordination or a need for previously associated industries to work together, an absence of cohesive long-term growth policy from the Government, and the lack of detailed business case analysis to clearly define commercial incentives.

In Germany, the growth in jobs in the renewable-energy sector owes much to an interventionist Government in Berlin. That will not be replicated by the Key Government. Responding to the report, Economic Development Minister Steven Joyce noted, unconvincingly, that it underscored the importance of existing Government initiatives. But "it is important that we don't pick 'winning' industries and exclude others", he added. That observation holds little water as the same Government has moved mountains and the employment law to ensure The Hobbit is made here.

Nonetheless, it is apparent that if green growth opportunities are to be seized, the private sector will have to take the lead. Talk about industry initiatives will have to be matched by action. The other obstacles identified by Pure Advantage will have to be overcome. These opportunities are being embraced in Europe and parts of the United States, and New Zealand risks missing the boat.

It would be a great shame if this report went nowhere. If it does, and there are no major oil and gas discoveries, New Zealand's economic future will continue to depend on the cyclical ups and downs of agricultural commodities. The green growth areas that have been identified offer the prospect of financial profit, environmental benefit, and a better balanced economy. And this in an area where New Zealand already has a competitive advantage globally because of its clean green image.

If the opportunities are grasped, jobs will be created and living standards will improve. At a time of serious economic and environmental pressure, this is not something that should be allowed to slip by.