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Foreign investment in Aotearoa/New Zealand
Overseas Investment Office - March 2024 Decision
Burning Rubbish
This is the controversial proposal to build a rubbish incinerator (a waste to energy plant) near Waimate in South Canterbury. It has spawned a very active local opposition movement and seen hundreds of people protesting in Waimate. The Minister for Land Information (Chris Penk) and Associate Minister of Finance (David Seymour) approved South Island Resource Recovery Limited (SIRRL) China 60%, New Zealand 40%, to make the "acquisition of a freehold interest in approximately 14.85 hectares of land located at Morven Glenavy Road, Waimate, Canterbury". Both the price paid and the identity of the seller have been suppressed.
To quote the OIO: "The Applicant is a joint venture between China Tianying Incorporated and Renew Energy Limited. The Land currently forms part of a dairy farm but is surplus to operations. Subject to receiving the necessary resource consents, the Applicant intends to construct and operate New Zealand's first large scale waste to energy plant on the land. The facility will convert municipal and construction solid waste into steam, water and electricity".
"The main benefits to New Zealand include increased jobs, significant capital expenditure, the introduction of new technology and business skills and energy production. Consent was granted as the Applicant met the investor test and the Investment is likely to result in benefit to New Zealand. The Minister of Finance has decided that the Investment is not contrary to New Zealand's national interest".
Unusually, and undoubtedly reflecting the controversial nature of the proposal, the OIO Decision summary also includes a link to a 33-page Overseas Investment Assessment Report.
Disappointment
The OIO's approval to buy the land on which to build the plant was greeted with dismay by its opponents (Stuff, 2/5/24, Yashas Srinivasa). Why Waste Waimate spokesperson Robert Ireland said: "The OIO summary of SIRRL's application approval, states that the 'Minister of Finance has decided that the investment is not contrary to New Zealand's national interests'. Ireland said the group did not agree with that statement".
"'Burning waste to create modest amounts of electricity is providing another easy waste disposal option for the South Island, and locks us into a system where private companies continue to financially benefit from the production of waste for the next 35 years. How is that not contrary to New Zealand's national interests in its attempts to move towards waste minimisation?'"
"Ireland also disputed the proposed plant would result in an 'increase in jobs. The proposal is to divert waste away from landfill for incineration. Although there may be an increase in jobs at Glenavy, the incinerator will be taking employment away from operating landfills elsewhere'. Ireland said the 'significant capital expenditure' of $350 million mentioned in the summary could be spent on 'truly renewable energy production' or 'initiatives to reduce waste, rather than burning and burying it'".
"Waimate GP Dr Crispin Langston, part of an unofficial group known as Waimate Doctors which had been vocal in its opposition to the proposal throughout, said the decision seems to have been judged on one factor. 'Purely short-term financial grounds rather than considering the environment and local communities wishes and safety'".
A Rubbish Proposal
Robert Ireland, on behalf of Why Waste Waimate, wrote a lengthy article about this in Watchdog 164 (December 2023, "A Rubbish Proposal"). Here are some extracts. "W-t-E (waste to energy) is the process of burning municipal solid waste (MSW) to create steam which in turn powers a turbine to create electricity. SIRRL's proposal is to burn 365,000 tonnes p.a. of MSW and construction waste (CW) gathered from around the South Island to create 20-30 megawatts (MW) of electricity in the process. To put this amount into context, NZ generated 9,758MW of electricity in 2020".
"SIRRL is a 60% overseas-owned company made up of China Tianying (CNTY) 41%, Europe Zhongying (EUZY)19% and NZ company Renew Energy Limited (REL) 40%. Although EUZY is registered in Europe it is 100% owned by the controlling Chinese shareholder CNTY. A percentage of CNTY shareholder companies are owned by the Chinese government". The proposal is called Project Kea - how's that for greenwashing?
"The Project Kea Website also does a pretty good job of Euro washing this proposal, by providing references to W-t-E in Europe, but does nothing to reference W-t-E practices in the country this proposal truly aligns with, China. The technology to be used is Chinese-owned, the company which will build the plant is Chinese-owned and the company which will own the controlling percentage and which will operate the Project Kea plant is again Chinese-owned. CNTY, which SIRRL claims has the technology and expertise to build and operate a plant that will outperform European Union standards, has yet to build a plant outside of Asia. No accessible data from any reference plant has been provided to substantiate the company's claims".
"The NZ arm of SIRRL, Renew Energy, has previously attempted to build a W-t-E plant in Westport. This became untenable after the then Buller Mayor, Gary Howard, accompanied REL directors on a trip to China to view a CNTY W-t-E plant, and while there signed operational deals with the Chinese without his Council's knowledge (Stuff, 04/04/19, Joanne Carroll)".
"In 2018 Renew Energy managed to acquire a $350,000 feasibility grant from the Government to investigate the viability of a W-t-E plant, however this was retracted after Government ministers learned that REL director/shareholder and founder, Gerard Gallagher, was being investigated by the State Services Commission for his part as a public servant working in the former Christchurch Earthquake Recovery Authority (CERA). (Stuff, 28/02/18). Mr Gallagher would later be charged by the Serious Fraud Office (SFO) and found guilty on three charges of corrupt use of official information"
"REL then moved on to Hokitika to yet another eagerly awaiting Mayor, but again failed to impress locals after an Official Information Act (OIA) request provided material that showed another REL director, Kevin Stratful, had used his work emails while working as a ratepayer-funded West Coast Economic Development consultant to promote the W-t-E proposal that he had a personal interest in. It was also made public from this OIA material that Mr Stratful had tried to coach councils on how to avoid OIO requests (Stuff, 14/11/19)".
A Dying Industry
"There is the question of why build this plant so far away from the population base, waste source and infrastructure required to support it. If most of the waste is coming from Christchurch, wouldn't it be logistically better suited nearer Christchurch? Or maybe Waimate was seen as a sleepy little back water unlikely to put up much of a fight? It would seem that having backing from small town mayors has more bearing on the siting of these proposals than the actual working logistics. Similar W-t-E proposals have recently popped up in more small towns around NZ including Feilding and Te Awamutu as companies try last ditch attempts to get in on the tail end of a dying industry".
Robert Ireland's article has a whole lot more detailed information on just why this is - as he titled it - a rubbish proposal. Subheadings included: "Dangerous Emissions"; "Particulates"; "WHO, Dioxins"; "Burning Plastics"; "Community Condemns Waste-to-Poisons Plant"; "Jobs"; "Budget"; "Flood Risk"; "Fire Risk"; "Climate Changing Emissions"; "Better Alternative To Landfill?"; "Landfilling Ash"; and "Import Waste?".
He concludes: "So, Why Waste Waimate questions the intentions behind a 60% Chinese owned company wanting to acquire pristine farmland in a rural location, within a flood zone to build a waste incinerator hundreds of kilometres away from the waste source, and population base, without infrastructure to support it, when there are huge question marks over the waste availability and the economic viability of a W-t-E plant in NZ, with a budget that is proven to be well below what's required to provide best practice standards. There is also the question of how this company believes it can make W-t-E work in this country when previous feasibility studies conducted in NZ by well-established W-t-E companies have concluded that the figures don't stack up".
See also Press (11/7/24, Hannah Blumhardt).
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