‘Clutha energy free if second smelter built’

Press, 29 June 1982, Page 1

‘Clutha energy free if second smelter built’

If the second aluminium smelter at Aramoana was built, the energy resource in the Clutha River would be handed over free, said the member oi Parliament lor Tarawera, Mr lan McLean, in Christchurch last evening. Only the cost of turning the energy resource into electricity would be passed on in the’power price figures for the smeller,' he told a Fendalton electorate meeting “The figures only provide a return on the capital invested — the dam's generating equipment, transmission lines, etc. — and makes no charge for the energy resource in the Clutha.

"In other words the energy is handed over free and the only return is based on the investment to turn it into power," he said. An energy charge was levied on New Zealands other energy resources, but not in the case of the proposed smelter. Mr McLean suggested that an energy levy should perhaps be included in the power price.

In these circumstances, it would not be responsible to sell the power at a price which was inadequate, he said. The price offered by the Aramoana consortium, was not high enough to justify the huge investment in generating facilities needed to provide electricity for the smelter. Mr McLean, who is the chairman of the public ex-

penditure committee, said that a high dam on the Clutha would provide only 55 to 60 per cent of the smelter's power needs. Extra generating facilities in the North Island and South Island would be needed, at a cost of about $1 billion. For such an investment, the power price offered was not high enough.

The Press Association reported from Wellington that official sources said that the Government “expectation" of the price it hoped to receive now fell short of the figure it had originally been seeking —1.9 c a unit in 1980 terms or an estimated 2.5 c now.

The sponsor's offer was about 1.5 c in 1980 terms — or 2c now — at one stage of the negotiations last week. The real cost of producing the power, in. 1982 terms is about 4.5 c a unit, the sources said.

Nevertheless. Mr McLean said, the Clyde dam' should go ahead without delay. The power would be needed in the future, smelter or no smeller.

. It was quite . clear that a high dam was more economic. and would provide irrigation for 2000 ha '.of land. The low dam option, which would cost about $l5O million more than a high dam.’was in fact two dams — one low dam with a high dam further upstream. Water from the second option would have to be pumped for irrigation.

Mr McLean said it would be irresponsible for Parliament not to proceed with special legislation to allow the dam to go ahead. The dam was needed "to make sure your lights keep burning through the 1980 s" and to prevent hardship for hydro workers who had moved to Central Otago. . “The legal system has failed in its task of reaching just decisions without unreasonable delays. In the event of such a failure it is the responsibility, and duty of Parliament.’as- the highest court' in the land, to determine the issue." he said.

In answer to a question. Mr McLean said that the delays over the dam had not been caused by Government "bungling." The delays had been caused through an "excess of desire to involve the public, and a belief that the legal process would work." “The legal procedures for handling water rights are grossly inadequate, because they don’t allow a final decision to be made within a reasonable time," he said. If the ease was sent back to the planning Tribunal, as the "Labour spokesman on constitutional affairs (Mr G. W. R.-Palmer) had suggested, there Could be a further 12month delay. On past experience, ’the case could again be taken to the High Court and Court of Appeal.

With no Aramoana smelter in prospect. Mr McLean said the focus must now be on other forms of South Island development. These included irrigation, closer ecomomic relations with Australia, and tourism.

"Comment has been made recently on arrival at Christchurch Airport being a fate worse than death. Let me say that any tourist who prefers to arrive at Auckland rather' than Christchurch needs his head read." he said.

Commenting on the wage and price freeze, announced last .week, Mr McLean said’ that the Government had to act now; to add new measures.

The freeze by itself was not enough to bring inflation under .control, he said. The other measures that were needed included control of the money supply, lowering the Government deficit, looking at wage-fixing proceedures. and looking at State-owned businesses.