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A state-imposed carbon tax could end plans for a coal-fired Marsden B power station, Energy Minister David Parker says.
Mr Parker, who is also the Minister for Climate Change Issues, said the Government favoured renewable energy sources over fossil fuels such as coal, and had already signalled a cost on carbon emissions for electricity generators.
"So on that basis, Marsden B is unlikely to go ahead," he said.
Mighty River Power, the state-owned enterprise behind the Marsden B scheme, said the project would only proceed if it were economically viable.
The company was granted resource consent to fire up the mothballed station using coal last year, but this has been appealed against in the Environment Court.
Mighty River's external affairs general manager, Neil Williams, said the consent application was only one step of the process and did not necessarily mean the station would be built.
"Whether it's built will depend on other things, such as whether a carbon tax is imposed," Mr Williams said. "If a carbon tax is imposed it makes the project relatively less attractive. The bigger the tax, the less attractive it becomes so I wouldn't disagree with the minister's statement."
Mighty River would decide whether to proceed when the consent process was finished.
Mr Parker's statement delighted environmental watchdog Greenpeace and the Marsden B and Bream Bay action groups, which all have appealed against the consents.
Greenpeace climate campaigner Vanessa Atkinson said the minister should now step in to halt the Marsden B project.
"If David Parker doesn't think that Marsden B will go ahead, then he must step in and stop the project, and provide some certainty instead of having it hashed out in the courts," Ms Atkinson said. "Mighty River Power ... is wasting taxpayers' money proceeding with the climate-polluting Marsden B proposal, including now dragging it into the Court of Appeal challenging the October High Court decision that climate change must be considered in the Marsden case."
Marsden B Action Group spokeswoman Catherine McNamara said the minister's comments were "great news".
"While this is dragging on through the court it's costing us money to fight it," she said. Bream Bay Action Group spokeswoman Margaret Hicks was delighted at the "marvellous" news.
In July, independent Environment Commissioner Morgan Williams said a coal-fired station ran counter to commitments to stabilise greenhouse gas emissions.
- NORTHERN ADVOCATE (WHANGAREI)
