If you've struggled to gauge the direction of this government, on energy efficiency policy at least, its ad libbing days are numbered. But the lignite to urea fertiliser proposal is fool's gold

If news emerged that the Energy Efficiency and Conservation strategy had been “axed” in a week when you were quite coincidentally formulating another Pundit post about not very joined-up thinking you'd think... nice.  Except that it didn't happen; it was a Labour beat-up .

Mischief-making  Opposition spokesperson  Charles Chauvel  would have realised his mistake, if  he'd  spent 10 minutes reading the Energy Efficiency and Conservation Act 2000 (the Act), and checking the Gazette. The media report on which he based his press release condemning the "axing" was misinformed. It might have suited him to remain misinformed: tit for tat and all that. Pre-election, the Labour government’s energy efficiency strategy suffered from National’s mischaracterisation of it.

Under that Act, the Minister of Energy must ensure that, at all times, there is a strategy in force  that promotes energy efficiency, energy conservation, and the use of renewable energy sources. “Axing” isn’t an option, nor is  ministerial sneaking around, short of repealing or significantly amending the Act. If the minister determines that the strategy should be replaced, he (in this case, Gerry Brownlee) must publicly notify his intention, and ensure that a replacement strategy is promulgated in accordance with the statutory process. That process requires public consultation and submissions. “Publicly notify” means publishing a notice in one or more daily newspapers circulating in the main centres, and in the Gazette, and on the internet.

On August 3, 2009 Brownlee gazetted his decision to replace the strategy. Until it is replaced, the current one remains in force.

The previous government’s strategy sets out half a dozen broad brush objectives, for example, “warm dry healthy homes with improved energy costs”, “reduce transport system energy use and greenhouse gas emissions”, and “90 percent of electricity generated from renewable resources by 2025”. Each of these is underpinned by more detailed proposals, whose degree of specificity varies, from “make decisions” or “publish policy”, to “10 percent reduction in public sector energy use per FTE by the end of 2012 compared with 2006/07”, “introduce fuel economy labelling for light vehicles”, and “subsidise an additional 5.7 million compact fluorescent lamps by the end of 2009”.

This government's revision isn’t surprising. The two surprises are, first, that it’s taken the best part of a year for a formal announcement to emerge when the Act requires it “as soon as practicable”. After all, revision of the policy was notified on the Energy Efficiency and Conservation Authority (EECA) website on April 6 , and later that week in the National-Greens working arrangement. Brownlee even flagged his intent back in February, in a section of his "first major speech" as minister titled "reviewing the energy strategy". Second, that the Opposition spokesperson not only doesn’t read the Gazette; if his press release is to be believed, he's managed to miss this whole series of developments in his shadow portfolio that fall not far short of ministerial knicker-waving.

The 2007 strategy reads like a Clark government manifesto. Its revision is a corollary of all the other things this government has already announced it isn’t going to do. It may also be a reaction to Jeanette Fitzsimons’ continued use of it as a vehicle for accountability, for example, in the Greens' "

Big Affordable Climate Change” proposal released on August 4. The strategy gives shape to the work of the EECA. For Brownlee to get the Authority that he administers heading in his direction, rather than the previous government’s, the strategy had to be revised.

What emerges from the revision process is going to be fascinating, for two reasons.

First, the current strategy and, indeed, the Act itself, were both Fitzsimons’ work. Under the memorandum of understanding between National and the Greens, Brownlee has agreed to collaborate with Fitzsimons on updating and revising it. Whatever emerges at the end of that process will be indicative of the Greens’ influence on this government.

My heart goes out to Fitzsimons, though, who must be having to perform what would be an anatomically remarkable feat at the best of times – simultaneously holding her nose and breathing through it.

Second, the government will be forced to do what it has not deigned to do to date: articulate its policy. Under the Act, the strategy must address certain requirements. The government must state its policies and objectives; set targets that are measurable, reasonable and practicable; and say how it will achieve them. As a matter of principle, you’d hope and expect that the onus will fall on Brownlee to explain, in relation to each ditched proposal, why it was not viable. All this will be a huge departure from the pretty random approach we’ve seen to date.

Which brings me to Southland lignite coal, the example of not very joined-up thinking I mentioned earlier.

The lignite to urea fertiliser proposal hit the headlines in the very week the prime minister was busy big-noting our “Global Alliance on sustainable agriculture” credentials.

It’s a Solid Energy feasibility study, not a government proposal. However, as a state-owned enterprise, you’d expect Solid Energy to defer at least a little bit to its minister’s expectations. The proposal’s aggressive backing by Conor English, Bill’s brother, on behalf of Federated Farmers might be another wee straw in the wind – or not, because, superficially, the proposal looks good for farmers.

Having spent the last several years purchasing or obtaining access rights to lignite in Southland, Solid Energy divines that the best use of this (it’s not an easy thing to find acceptable uses for) is to convert it to urea fertiliser. Building and running a plant will create jobs for Southland, satisfy domestic dairying demand that is currently at the whim of a fluctuating international market, and have billion-dollar export potential. Pattrick Smellie reports on its economic prospects, here and here, including downstream conversion to diesel.

However, it’s been called “a triple hit on the environment” by the Sustainability Council’s Simon Terry. The correlation between urea application and nitrous oxide emissions is well-understood. Some disappears on application; then cows eat the nitrogen-laden grass and emit more when they pee. Nitrous oxide is a greenhouse gas, a culprit in ozone depletion, and  fresh water degradation  also  occurs from  the  nitrogen run off.

If demand for urea  was constant, the only live question would be whether to import it or not , and Terry's argument would be pretty substantially undercut. Martyring ourselves economically won’t help. However, I still think he's on the side of the angels, for these reasons.

English and Don Elder, the Solid Energy chief executive, say that if a plant was built, it would be “fully carbon compliant” with the emissions trading scheme. Subtext: not only “fully”, but “gladly”! If the scheme continues in a similar vein, the obligations on Solid Energy et al will be small; the “trickle down” effect of a boom in Southland and propping up dairying would have to be more of a flood to compensate. It’s not really a response, either, because compliance is not the same as an emissions reduction path.

Then, there’s talk of nitrification inhibitors, and “biofeedstock options”. If that’s a fancy way of saying “feeding cows stuff other than grass” then … um … why would you be buying urea, again?

We can deduce that the Global Alliance will spend its time dreaming up whizzy scientific ways to breed and feed and house ruminants, and calling it original thinking. I’d call it more of the same, and kind of a circuitous route to sustainability – make a big mess, clean it up again, and we’ll all clip the ticket on the way round. Genius.

The pollution risk is known; the capacity to alleviate speculative. Terry has been an advocate for the use of nitrification inhibitors, but every time he tries to talk about it, Charlie Pedersen (English’s predecessor) comes on grumbling about how it’s just not that simple for farmers. The government  and farm lobby position has been that there’s little we can do about agriculture, in setting an emissions reduction target. And yet, when it comes to an economic rev-up it's  evidently a no brainer.

TVNZ reported  last week that worms, mites and nematodes are the way to the future (yep), and a newsworthy scientific development (er… no, ask an organic gardener, or your grandparents). Described as an "underground breaking new study by AgResearch and Massey University," a scientist told us that the tiny creatures play a vital role because "they excrete little poos that are high in nutrients that are really good in the soil". It was great to see this reported – a rare PR coup for sustainability – but the contorted white lab-coated angle necessary to make the news was very funny.

The trouble with worms is, they do what they do for free, for love, just because they can; only the soil gets rich. Urea fertiliser is among farmers’ highest expenses; humusy wormy soil sequesters carbon, rather than emitting it. Turn the thinking inside out, and there’s your profit motive.