Gas Emissions 40% Introduction. Key Messages. Energy Sector Emissions 32% ABOVE the 1990 level. Road transportation produces

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1 ENERGY MODELLING AND SECTOR TRENDS 14 Energy 213 CALENDAR YEAR EDITION Greenhouse Gas Emissions Key Messages Energy Sector Emissions 32% ABOVE the 199 level Road transportation produces 4% of all energy sector 7,136 5,762 Electricity generation DECREASED 19% from 212 Introduction This publication presents information on greenhouse gas from the energy sector for the calendar years Energy sector are responsible for slightly less than half of New Zealand s total gross. gross include agriculture, energy, industrial processes and waste sector, but exclude emission reductions from land use change and forestry. Emissions are presented as carbon dioxide equivalent (CO 2 -e) of the direct greenhouse gases carbon dioxide, methane and nitrous oxide based on updated global warming potentials (see Technical Notes on page 1). This publication updates the annual series and includes revised numbers for where improved data or methodologies have been applied. New Zealand is a signatory to both the United Nations Framework Convention on Climate Change (UNFCCC) and the Kyoto Protocol first commitment period. As an Annex 1 country under the UNFCCC, New Zealand is committed to produce a national inventory of greenhouse gas sources and sinks. As a signatory of the Kyoto Protocol, New Zealand has accepted that for the period 28 to 212 it will take responsibility for all in excess of 199 levels. The energy sector data presented in this publication will feed into New Zealand s Greenhouse Gas Inventory that will be published by the Ministry for the Environment and submitted to the UNFCCC in April 215. In addition to energy sector, New Zealand s Greenhouse Gas Inventory includes from agriculture, industrial processes, solvent and other product use, waste and land use change and forestry. WANT A CLOSER LOOK? For detailed data, visit:

2 2 SNAPSHOT 213 Emissions from transport continue to dominate in 213, making up 44% of total in the energy sector, slightly up on the previous year. In fact, transport are greater than electricity, manufacturing and fugitive combined. By fuel type, liquid fuels are responsible for the majority of. Over three quarters of liquid fuel come from the transport sector. DETAILED DATA TABLES ARE AVAILABLE AT: energy-modelling/data FIGURE 1A: Energy Emissions by Sector 213 (kt CO 2 -e) % 1% 2% 3% 4% Transport Manufacturing Electricity Agriculture Forestry & Fishing Transformation Commercial Residential 2, 4, 6, 8, 1, 12, 14, Gas Liquid Fuels Geothermal Biomass FIGURE 1B: Energy Emissions by Fuel 213 (kt CO 2 -e) % 1% 2% 3% 4% 5% Liquid Fuels Gas Geothermal Biomass 2, 4, 6, 8, 1, 12, 14, 16, 18, Transport Electricity Manufacturing Primary Industries Transformation Commercial Residential

3 EMISSIONS BY FUEL 3 New Zealand s energy sector were 31,659 kt CO2-e in 213, down 3% from 212. Since 199, the base year for Kyoto Protocol obligations, New Zealand s energy sector have increased in total by 32%, averaging 1.2% growth per annum. During this period New Zealand s GDP grew by over 215%. In 213, higher hydro and geothermal electricity generation together with lower electricity demand reduced the need for electricity generation from coal. This resulted in a significant decrease in from coal combustion. Liquid fuel combustion, driven by the transport sector, continues to dominate, at over 55% of total energy sector. An increase of 5% between 199 and 23 is largely responsible for New Zealand having one of the largest increases amongst Annex 1 countries in energy sector since 199. Natural gas combustion increased up until 21 as the chemicals industry (manufacturing synthetic petrol and methanol) and electricity generators took advantage of the relatively cheap Maui and Kapuni gas contracts. In the late 199s, synthetic gasoline production stopped in New Zealand and by 23 rising gas prices led to the closure of Methanex s methanol plant at Motunui followed by the Waitara Valley plant in 28. During 212, both trains at Motunui were restarted, and in late 213 the Waitara Valley plant was restarted., including those associated with geothermal electricity generation, dropped 11% from 212, driven mainly by reduced coal mining. TABLE 1: Energy Emissions by Fuel Type (kt CO 2 -e) Liquid Fuels Natural Gas Biomass Combustion ,974 7,86 3, ,428 1,566 23, ,22 9,275 2, ,338 1,996 3, ,476 7,363 6, ,657 2,456 35, ,762 6,991 4, ,593 2,683 32, ,773 7,636 3, ,199 2,99 32, ,833 7,53 3, ,89 2,747 31, ,722 7,42 5, ,28 2,415 32, ,36 7,199 4, ,54 2,154 31, / % 1.6% 26.9% 22.6% 31.6% 37.5% 31.9% 199/213 p.a. 1.8%.1% 1.%.9% 1.2% 1.4% 1.2% 212/ % -2.7% -17.6% -3.% -2.6% -1.8% -3.2% % of total 213 energy CO2-e FIGURE 3 57.% 22.7% 13.%.4% 93.2% 6.8% 1.% FIGURE 3: Energy Emissions by Fuel Type (kt CO 2 -e) 4, 35, 3, 25, 2, 15, 1, 5, Liquid Fuels Natural Gas Biomas

4 EMISSIONS BY SECTOR DETAILED DATA TABLES ARE AVAILABLE AT: energy-modelling/data 4 As mentioned in the previous section, most of the decrease in seen between 212 and 213 was due to decreased coal-fired electricity generation. The 21% decrease in from electricity generation (excluding geothermal) was mostly due to coal generation decreasing from 2,712 GWh in 212 to 1,624 GWh in 213. Note that from geothermal electricity generation are captured in the fugitive sector. For information on electricity generation, see page 6. Transport have increased 6% since 199 and now account for over 44% of all energy sector. Transport are broken down by mode on page 5. Transformation industries includes all energy transformation industries other than electricity generation (e.g. oil refining). The large drop is due to the production of synthetic gasoline ceasing in the late 199s. Manufacturing sector increased by 11%, driven primarily by the chemicals subsector. For a sector-by-sector breakdown of manufacturing industries, see page 7. Definitions of the sectors described on this page can be found on page 1. TABLE 2: Energy Emissions by Sector (kt CO 2 -e) National Transport Electricity Generation Manufacturing Industries Transformation Industries Other Sectors Subtotal Combustion 199 8,775 3,493 4,758 2,5 2,92 22,428 1,566 23, ,356 Table 2: 5,356 Energy Emissions 6,358 by Fuel Type 1,147 (kt 3,121 28,338 1,996 3, ,113 8,518 5,63 1,185 3,238 32,657 2,456 35, ,933 6,24 5,2 1,246 2,974 29,593 2,683 32, ,95 5,482 5,343 1,328 2,951 29,199 2,99 32, ,94 4,997 5,258 1,34 3,12 28,89 2,747 31, ,856 6,385 5,356 1,329 3,354 3,28 2,415 32, ,75 5,43 5,955 1,246 3,185 29,54 2,154 31, / % 44.4% 25.1% -5.1% 9.7% 31.6% 37.5% 31.9% 199/213 p.a. 2.1% 1.6% 1.% -3.%.4% 1.2% 1.4% 1.2% 212/ % -21.% 11.2% -6.2% -5.% -2.6% -1.8% -3.2% % of total 213 energy CO2-e 44.5% 15.9% 18.8% 3.9% 1.1% 93.2% 6.8% 1.% FIGURE 4 FIGURE 4: Energy Emissions by Sector (kt CO 2 -e) 4, 35, 3, 25, 2, 15, 1, 5, National Transport Manufacturing Industries Electricity Generation Other Sectors Transformation Industries

5 TRANSPORT BY MODE 5 Domestic transport includes all transport where the journey begins and ends in New Zealand. Off-road use is accounted for in the sector in which the activity occurs. For example, from fuel used by a tractor on a farm are included under agriculture energy. Emissions from fuel combusted by international aviation and sea-going vessels are included here. However, these are reported only as a memo item in New Zealand s Greenhouse Gas Inventory, as recommended in the Intergovernmental Panel on Climate Change (IPCC) guidelines. Road transport constitute by far the largest share of domestic transport. At 12,688 kt CO2-e in 213, these made up 4% of all energy sector. While road transport in 213 were up 69% over 199 levels, the trend has been flat since about 27. This is due to a flat trend in transport activity combined with improving fuel efficiency. The transport of passengers and freight by rail tends to be less carbon intensive than by road. TABLE 3: Transport Emissions by Mode (kt CO 2 -e) DOMESTIC INTERNATIONAL Road Rail Aviation Marine Aviation Marine 199 7, ,775 1,333 1,56 2,389 11, , , ,356 1, ,579 14, , , ,113 2,324 1,126 3,45 17, , , ,933 2,327 1,28 3,356 17, , , ,95 2,337 1,78 3,416 17, , ,94 2,438 1,29 3,467 17, , ,856 2, ,56 17, , ,75 2, ,493 17, / % 87.8% -9.9% 49.6% 6.4% 89.2% -8.1% 46.2% 57.4% 199/213 p.a. 2.3% 2.8% -.5% 1.8% 2.1% 2.8% -.4% 1.7% 2.% 212/213.9% -3.9% 3.6% 28.7% 1.6% -.1% -1.% -.4% 1.2% % of total 213 energy CO2-e 4.1%.5% 2.7% 1.2% 44.5% n.a. n.a. n.a. n.a. FIGURE 5: Domestic Transport Emissions by Mode (kt CO 2 -e) 16, 14, 12, 1, 8, 6, Road Aviation Marine Rail 4, 2,

6 ELECTRICITY EMISSIONS DETAILED DATA TABLES ARE AVAILABLE AT: energy-modelling/data 6 Emissions from electricity generation, including geothermal fugitive, were 5,792 kt CO2-e in 213. Emissions fell 19% over the year as Huntly s coal and gas units were used less after hydro generation returned to more normal levels. fired plants produced 1,8 GWh less electricity in 213 compared to 212, and this resulted in a 4% drop in coal. Genesis Energy has put two Huntly coal and gas units into long-term storage, one of which is in the process of being decommissioned. These older and less efficient technologies are being pushed out of the market by cheaper and cleaner technologies such as geothermal and wind, which have lower. Geothermal and wind energy increase baseload electricity generation meaning that less thermal baseload generation is required. The intensity of New Zealand electricity generation is low by international standards due to the high proportion of demand met by hydro generation. While this provides a strong base in good hydro years, electricity remain sensitive to rainfall in the key catchment areas. For 213 the approximate intensities for generation by fuel type were 72 kg CO2-e/MWh for coal, 42 kg CO2-e/ MWh for gas and 12 kg CO2-e/MWh for geothermal. TABLE 4: Electricity Emissions by Fuel (kt CO 2 -e) Natural Gas Liquid Fuels Biomass Thermal Geothermal 199 3, , , , , , ,42 3, , , ,658 2, , , ,191 1, , , ,466 1, , , ,67 2, , , ,415 1, , , / % 24.3% -78.% 565.3% 44.4% 164.3% 53.4% 199/213 p.a..6% 5.5% -6.4% 8.6% 1.6% 4.3% 1.9% 212/ % -4.1% -16.7% -3.2% -21.% -.2% -18.8% % of total 213 energy CO2-e 1.8% 5.1%.%.% 15.9% 2.4% 18.3% FIGURE 6: Electricity Emissions by Fuel (kt CO 2 -e) 1, 8, 6, 4, 2, Natural Gas Geothermal Biomass Liquid Fuels

7 MANUFACTURING SECTORS 7 This section includes from fuels combusted in factories, plants or mills, as well as for electricity generation where the primary purpose is to support an onsite manufacturing activity. This does not include from chemical processes such as hydrogen, steel or cement production as these are considered industrial process according to IPCC guidelines. However, from methanol production are reported under manufacturing in this report and in New Zealand s Greenhouse Gas Inventory. Emissions from the food industries have made up most of New Zealand manufacturing industry since 23. These are largely the result of coal and gas used to raise heat for dairy processing. Emissions from the Chemicals sector have been increasing as Methanex returns its methanol production to full capacity. Figure 7 shows a distinct drop in from the chemicals sector from 23, when methanol production fell in the midst of rising gas prices. TABLE 5: Manufacturing Emissions by Sector (kt CO 2 -e) Chemicals Pulp, Paper & Print Food Mining & Construction Non-metallic Minerals Other , ,126 4, , , , , ,68 5, , , , , , , , , , , , , / % -1.8% 28.4% 56.1% 43.8% -41.1% 25.1% 199/213 p.a. 3.9% -.1% 1.1% 2.% 1.6% -2.3% 1.% 212/ % -2.4% -2.9% 3.2% 61.7% 27.3% 11.2% % of total 213 energy CO2-e 4.1% 1.7% 6.8% 1.8% 2.2% 2.1% 18.8% FIGURE 7: Manufacturing Emissions by Sector (kt CO 2 -e) 8, 7, 6, 5, 4, 3, 2, 1, Food Chemicals Other Mining & Construction Pulp, Paper & Print Non-metallic Minerals

8 8 OTHER SECTOR EMISSIONS For the purposes of the National Greenhouse Gas Inventory, Other Sectors includes the residential, commercial/ institutional sectors and agriculture, forestry and fisheries. This includes fuel combustion for stationary energy, such as space heating in the commercial sector, and off-road mobile combustion, such as on-farm vehicles in the agricultural sector. Emissions allocated to the residential sector have decreased 26% since 199, while commercial sector increased by only 1%, despite increasing household numbers and GDP. This is the result of a shift toward electricity as a primary energy source for both sectors. As electricity generation is DETAILED DATA TABLES ARE AVAILABLE AT: energy-modelling/data itself considered a sector, switching from primary fuels such as gas or coal - to electricity, causes an apparent decrease in in the sector in which the energy is consumed. Emissions from the primary industries sector have increased 39% since 199, in line with increased production. Approximately 3% of 213 in these sectors come from mobile combustion of liquid fuels, such as off-road vehicles on farms. Note that these are combustion only. Emissions resulting from enteric fermentation and manure management are not energy-related, so are captured elsewhere according to IPCC guidelines. TABLE 6: Other Sector Emissions (kt CO 2 -e) Commercial Residential Primary Industries ,224 2, ,536 3, ,669 3, ,456 2, ,462 2, ,644 3, ,83 3, ,76 3, / % -26.3% 39.3% 9.7% 199/213 p.a..% -1.3% 1.5%.4% 212/213-3.% -7.% -5.4% -5.% % of total 213 energy CO2-e 2.8% 1.8% 5.4% 1.1% FIGURE 8: Other Sector Emissions (kt CO 2 -e) 4, 3,5 3, 2,5 2, 1,5 1, Primary Industries Commercial Residential

9 FUGITIVE EMISSIONS 9 are those which arise from the production, processing, transmission and storage of fuel, and from nonproductive combustion. These have decreased 28% over the last three years, with the largest decline coming from the coal mining subsector. Emissions from natural gas processing and flaring had increased considerably in previous years. This was partly due to the decline in methanol production from 23, which resulted in an increase in vented from the Kapuni gas treatment plant. Previously, high-co2 gas from the Kapuni low temperature separation plant had been exported for methanol production. During 212 and 213 methanol production increased causing gas processing to decrease. In addition, flaring of natural gas at offshore oil fields increased significantly since 26. Some offshore oil fields are permitted to flare natural gas produced along with oil if it is not economically viable for a dedicated pipeline to be built to transport the gas onshore. Combusting the natural gas results in lower than simply venting it due to the higher global warming potential of methane relative to carbon dioxide. Geothermal electricity generation is another significant and increasing source of fugitive. These are considered fugitive as they are the result of the extraction process rather than combustion. Other leakage includes natural gas losses at the point of consumption. TABLE 7: (kt CO 2 -e) Mining and Post-mining Operations Gas Transmission and Distribution Gas Processing and Flaring Oil Transportation, Refining and Storage Geothermal Other Leakage , , , , , , , , / % -32.9% 96.6% 16.7% 164.3% -5.7% 37.5% 199/213 p.a. -.7% -1.7% 3.%.7% 4.3% -.3% 1.4% 212/ % -4.% -2.8% -6.2% -.2% 1.4% -1.8% % of total 213 energy CO2-e 1.%.6% 1.8%.% 2.4% 1.% 6.8% FIGURE 9: (kt CO 2 -e) 3, 2,5 2, 1,5 1, Gas Processing and Flaring Geothermal Mining Other Leakage Gas Transmission and Distribution Oil Transportation, Refining and Storage

10 1 Technical Notes Carbon Dioxide Emission Factors Carbon dioxide emission factors are used to calculate the amount of CO2 emitted per unit of fuel combusted. Other emission factors that do not involve combustion or the use of fuel are expressed in terms of per unit of production, or some other kind of activity. Oxidation factors are used to account for incomplete combustion. Carbon dioxide emission factors, both before and after oxidation, are presented in the detailed data tables at: energy/energy-modelling/data/ greenhouse-gas- Non-Carbon Dioxide Emissions Non-carbon dioxide are highly dependent on the conditions of combustion. For example, a litre of diesel used for industrial heating produces a different level of methane than the same amount used in a vehicle. Consequently, methods for calculating non-carbon dioxide differ by sector. Carbon Dioxide Equivalent Emissions Carbon dioxide equivalent (CO2-e) are calculated based on the ratio of the radiative forcing of one kilogram of greenhouse gas emitted to the atmosphere to that of one kilogram of carbon dioxide over a given time horizon. This report uses the global warming potentials from the Fourth Assessment Report of the IPCC: Methane (CH 4 ) = 25 Nitrous oxide (N 2 O) = 298 Previous editions of this report used values of 21 and 31 respectively, which were specified in the Second Assessment Report of the IPCC. Biomass Emissions Carbon dioxide from the combustion of biomass are not included in this publication, but methane and nitrous oxide from biomass are. This is because any carbon dioxide from woody biomass are captured in the Land Use, Land Use Change and Forestry (LULUCF) category, while carbon dioxide from biogas are accounted for in the Waste category. Sector Definitions Domestic Transport: includes from fuels combusted for domestic road, rail, air or waterborne transport. Emissions from off-road vehicle use are included in the sector where the activity takes place. Electricity Generation: includes from thermal combustion plants whose primary business activity is electricity generation. Plants that generate electricity to support another primary business activity are included in the manufacturing sector. Manufacturing Industries: includes from fuels combusted in plants, factories or mills, and fuel combusted for electricity generation where the primary purpose is to support the manufacturing activity. Emissions from methanol production are reported in the manufacturing sector in this report and in New Zealand s Greenhouse Gas Inventory. Transformation Industries: includes from fuels combusted by energy-producing industries during conversion processes, eg petroleum refining, synthetic petrol production, and oil and gas extraction and processing. Other: includes primary industries (agriculture, forestry and fishing), commercial and residential. : includes which arise from the production, processing, transmission and storage of fuels, from non-productive combustion, and from geothermal electricity generation. Voluntary Corporate Greenhouse Gas Emissions Reporting Information and factors for individuals and organisations wishing to calculate greenhouse gas from their activities can be found in the Ministry for the Environment s publication Guidance for Voluntary Greenhouse Gas Reporting at: mfe.govt.nz/climate-change/reportinggreenhouse-gas-/voluntarycorporate-greenhouse-gas-reporting Industrial Process Emissions Industrial process are those which arise from chemical reactions in which carbon dioxide is a byproduct, rather than the result of fuel combustion. Examples of industrial processes in New Zealand include the production of iron, and steel, aluminium, hydrogen, cement, lime, urea and methanol. Industrial process are not included in this report, with the exception of resulting from methanol production which are reported as energy-related in the manufacturing sector. Data Revisions New Zealand Energy Greenhouse Gas Emissions 213 includes many small revisions to time series due to improvements in data collection and emission factors. These improvements are made in order to better align with IPCC guidelines and are often the result of Expert Review Team recommendations. Revisions may be due to the inclusion of that were not captured in past reports, such as waste oil combustion in the manufacturing sector or gas leakage at the point of consumption. They may also be the result of more accurate country-specific or site-specific emission factors being developed, as has been the case for many geothermal electricity generation plants. As IPCC default emission factors are generally conservative, establishing a local emission factor normally results in a decrease in calculated. The Ministry of Business, Innovation and Employment gives no warranty on the accuracy, completeness or usefulness of any information in this publication. The Ministry shall not be held liable for any claims whatsoever arising from the use of this paper. The Ministry must be acknowledged when any information from this publication is used, reproduced or quoted. ISSN (print) ISSN (online) This work is licenced under a Creative Commons Attribution 3. New Zealand Licence. MB 1322_Dec14