Methanexit: New Zealand needs to stop subsidising our largest gas user!

The Methanexit report highlights a critical issue in New Zealand's energy policy: taxpayers are subsidising the operations of Methanex, the country’s largest fossil gas consumer, with free carbon credits worth $60 million last year. Over the past decade, this subsidy has totalled around $300 million, propping up a financially struggling, overseas-owned company that consumes up to 45% of the country’s gas supply. Methanex’s climate footprint is huge, producing over 1.1 million tonnes of CO2 per year - equivalent to the pollution of 480,000 petrol cars. We also now know that Methanex’s New Zealand plant is 34% more emissions-intensive than the company’s global average.

This dynamic perpetuates New Zealand's dependence on fossil fuels, artificially inflates electricity prices, and delays the transition to renewable energy. Read More

Email Minister Simon Watts to ask him to review subsidies for the biggest polluters

Dear Hon Simon Watts,

I am writing to bring your attention to the newly released Methanexit report, co-published by CICTAR, 350 Aotearoa and Common Grace Aotearoa. This report provides compelling evidence that the high energy prices affecting New Zealand households and businesses stem not from a lack of gas supply but from systemic underinvestment in renewable energy and ongoing subsidies for fossil fuel industries.

Methanex New Zealand Ltd, the country's largest user of fossil gas, has received over $300 million in free carbon credits through the industrial allocation scheme over the past decade. This subsidy has helped sustain an overseas-owned, polluting industry while propping up fossil gas demand, which undermines our renewable energy transition and inflates electricity prices for New Zealanders.

The report highlights that Methanex’s New Zealand plant is 34% more emissions-intensive than the company’s global average, so ongoing free carbon credits could have the opposite intended effect than preventing emissions leakage.

I urge you to review the findings of the Methanexit report and reconsider the appropriateness of Methanex’s free industrial allocation under section 84B of the Climate Change Response Act.  This review is critical to aligning government policy with our country’s climate goals and ensuring a fairer energy system for all.

I look forward to seeing how your government plans to address these concerns.

Sincerely,

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