A new report released today by the New Zealand Green Building Council reveals a major opportunity to tackle New Zealand’s energy crisis while delivering significant benefits for households, businesses, and the wider economy.
With fossil gas supplies in terminal decline and electricity demand rising, the country faces increasing energy costs, business closures, and job losses. But the report, Protecting industry, jobs and household budgets as the gas runs out, shows that accelerating heat pump adoption could help ease pressure on the energy system, cut costs, and help keep Kiwi businesses open.
“The closure of three mills by Winstone Pulp International and Oji Fibre Solutions due to soaring energy prices should be a wake-up call,” said New Zealand Green Building Council Chief Executive Andrew Eagles.
“These businesses are major contributors to our economy, providing jobs, exports, and revenue for government and local communities.”
The report found replacing gas and inefficient electric heaters with heat pumps could save up to 48 Petajoules of gas annually - nearly 40% of current production - and deliver net electricity savings of up to 4,000 GWh per year, enough to power over half a million homes. It’d also save New Zealand households up to $1.5 billion a year on energy bills.
“We’re still connecting thousands of new buildings to gas each year, even as supply runs out. This report shows we can turn it around by using readily available, viable alternatives that reduce demand, lower bills, and help protect jobs.”
Businesses would also benefit from more certainty around energy supply, reduced operating costs, and a better chance of staying competitive.
“It’s not just about technology, it’s about resilience,” says Andrew Eagles. “This simple step gives businesses more certainty, helps families with rising costs, and supports a more secure energy future.”
The report recommends:
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Expanded insulation and retrofit programmes
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Phasing out gas heating systems and new gas connections
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Stronger energy efficiency standards
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Subsidies for heat pumps and hot water heat pumps
“These measures would free up energy for high-value industrial uses and help avoid further closures,” said Eagles. “It is what other OECD countries are doing. It’s a win-win—and the time to act is now.”
The report is supported by Consumer NZ, Common Grace Aotearoa, Major Electricity Users’ Group, Octopus Energy, Simplicity, and Wood Processors and Manufacturers Association, and was developed with input from industry experts.