3a. Summary of submissions continued

3.6 Cost−benefit appraisal

3.6.1 Range and accuracy of the cost−benefit analysis

The general view was that the costs and benefits were analysed solely from the point of view of the line owner, rely heavily on Transpower estimates, and were included very selectively. As a result, it was claimed that the analysis is inaccurate and unreliable. Four submitters suggested that the analysis needs to include a more balanced and realistic approach in relation to additional costs imposed on the wider community, councils and affected landowners.

Several submitters saw the proposal as a transfer of costs from Transpower to landowners and local authorities, and a sequestering of property rights. One noted that if the line owner is the only beneficiary of the standards, then the line owner should pay the costs of implementing them. Another noted that the Government’s contribution of only $200,000 towards implementing the standards is at odds with the claim that the proposal is of national importance. One landowner felt that it is unlikely that electricity prices will go down due to diminished grid costs.

Council costs

Eleven submitters noted that implementing the standards as proposed would result in a considerable increase in enforcement and monitoring costs for councils, especially in terms of changing their plans to comply with the NES, and that these costs were understated in the analysis. One council noted that the cost−benefit analysis lacked sufficient detail and robustness for councils to assess the additional resources required, and that the assumed costs to councils seemed very low. The majority of councils making submissions on the proposals indicated that they would be likely to undertake plan changes to incorporate the NES into their plans. It was estimated that at a suggested cost of $50,000 per council, the total cost would be around $3.5 million. However, it was proposed that these plan change costs could be minimised if standards were completed prior to second-generation plan reviews.

The enforcement responsibilities were thought to create potential liabilities for councils if, for example, a council approves an activity adjacent to a transmission line which subsequently causes damage to the line, likened by one submitter to the “leaky homes nightmare”. Such costs have not been considered in the cost−benefit analysis. A number of submitters questioned how the estimated implementation cost to councils in the first two years was derived.

Landowner costs

Eight submitters were concerned that costs to individual landowners were only briefly mentioned in the text of the discussion document and were largely overlooked in the actual analysis. A number of submitters emphasised the fact that the cumulative cost of $7 billion dollars imposed on a small portion of the community required more justification, and an explanation of how this figure was reached. Several submitters noted that the analysis does not take account of the sequestration of property rights, the unrecoverable costs of landowners hosting transmission lines, and the changes to this under the NES.

One submitter suggested that a cost−benefit analysis should include an assessment of the potential liabilities to individual landowners due to accidental damage or outages. The draft economic appraisal was also criticised for not identifying the costs of restrictions on land use. One landowner estimated that the annual unrecoverable cost of hosting transmission lines would be $4.60 per linear metre of line per year for agricultural operations. The landowner then reported the cost of Option B for the transmission risks NES to be $20 to $30 per linear metre for dairy farms ($20,000 to $30,000 per linear kilometre), taking into account restrictions on land use, the value of capital improvements and the capacity of owners to undertake works. Submitters claimed that rural and urban landowners would be affected differently, with the latter facing a more severe loss of property value, which has not been taken into account in the evaluation.

Individual submitters noted that risks to residential property owners from transmission lines were not accounted for in terms of the financial analysis.

Benefits of the proposed standards

One industry submitter noted that the net present value (NPV) of the proposed standards was miniscule compared to other potential improvements that could be facilitated by government or Electricity Commission actions. One submitter noted that without an NES, consent authorities would progressively remove inconsistent consent requirements as a result of Transpower advocacy, which would erode the claimed NPV of the proposed standards to the level where it was not worthy of further consideration. The claimed benefits of the transmission risks NES were thought to be no more than a shift of who bears the risks along with a wealth transfer, rather than any gain in economic efficiency.

Three submissions from the electricity industry noted that the range of benefits from implementing the proposed standards might be greater than anticipated due to the large benefits of achieving the objectives of both the New Zealand Energy Strategy and the New Zealand Energy Efficiency and Conservation Strategy. These submitters predicted that the New Zealand economy would benefit from the standards due to the expansion of the transmission network and electricity network as a whole, and increased security of supply through a robust RMA framework. However, the benefits from the proposed transmission activities could be lower than estimated if the NES imposes additional resource consent requirements on transmission activities.

One individual submitted that there is inadequate consideration of the benefits of alternative mechanisms (eg, the Minister’s call-in powers, easement agreements etc.), and the benefits of the NES do not appear to outweigh those of other alternatives (see section 3.2.3 on consideration of alternatives).

3.6.2 Requirements of section 32 of the RMA

Nine submitters commented that the analysis would not be sufficient to meet the requirements of section 32 of the RMA. Section 32 requires consideration of the extent to which the objective is the most appropriate way to achieve the purposes of the RMA, and whether, having regard to their efficiency and effectiveness, the methods are the most appropriate for achieving the objective(s). One submitter thought the cost−benefit analysis would not meet the requirements of section 32 of the RMA because neither costs nor benefits for people and wider communities were considered. Two submitters noted that the RMA does not require that a section 32 analysis be prepared until the actual regulations are made, but thought a preliminary section 32 analysis should be available at the time of public consultation on proposals.

3.7 Electricity Act and land ownership issues

Submitters expressed concern about the proposed standards conflicting with the Electricity Act 2002 and having significant effects on landowners whose properties host electricity transmission corridors. Twenty-six submitters addressed the potential effects on landowners, and seven commented on the Electricity Act. Most of the comments on the Electricity Act and land ownership issues were received from landowners, but individuals, NGOs, the electricity industry, other industries and local government also stated their views.

3.7.1 Electricity Act issues

Seven submitters (five landowners, one NGO and one individual) expressed concern at the possibility of unlimited access to land by Transpower’s contractors, and three submitters cited examples of conflicts with Transpower’s contractors over timing of access or compensation for damage.

The Electricity Act provides Transpower with the right to access and maintain transmission lines provided there are no “injurious effects”. Submitters expressed the view that a number of proposed NES-permitted activities would result in encroachment, and in consequence, as established by the 2007 Fernwood Dairies Environment Court ruling (see p. 14), an injurious affect. One landowner questioned whether a substantially upgraded line should still qualify for the access provisions in the Electricity Act for pre-1988 lines, and noted that the Electricity Act was amended in 2001 to allow for “maintenance” to include “upgrading”, without consulting landowners.

Submitters also thought that allowing for activities not authorised by section 23.3 of the Electricity Act would compromise the interests of landowners and the purpose of that section of the Act. They suggested that the proposed standards would incorrectly signal that all scheduled activities, not authorised under section 23.3 of the Electricity Act, can be lawfully undertaken, which could be in conflict with the Act. One submitter expressed concern that if the proposed standards proceed, councils could be dragged into legal feuds between Transpower and landowners.

3.7.2 Effect on landowners

The possibility that the proposed NES will impose costs, obligations and liabilities on landowners, with no benefits or compensation offered was raised in all the submissions from landowners and many submissions from local government and individuals.

Landowners feared that the standards as proposed would result in restrictions on development and therefore lead to property devaluation. Expropriation of $7 billion worth of value with no acknowledgement or compensation was highlighted in landowners’ submissions. One submitter stated that the proposed NES relegates landowners to third parties, stripping them of dignity and property rights to use their own land.

Another issue mentioned was that landowners would have to apply for more resource consents while Transpower would need fewer as a result of the proposed standards. Such a situation was thought by submitters to be against natural justice and would result in restrictions on landowners’ usual activities, such as cropping, viticulture, horticulture, silviculture, and the use of modern mechanical harvesting, as well as the opportunity for land subdivision. One submitter pointed out that farming methods and technology have changed substantially since the transmission lines were built, and land-use options are increasingly restricted. Furthermore, some lines have been upgraded, increasing the impact on landowners without any compensation. This submission stated that the government is allowing Transpower to break Article 17.2 of the Universal Declaration of Human Rights by allowing arbitrary deprivation of property.

One submission pointed out that the proposed standards will not affect all landowners equally and that the loss of value would only apply to a small proportion of landowners; this, however, does not lessen the importance of the issues raised. Another submitter acknowledged that achieving sustainable management often requires the use of tools that have an impact on land use and considered these tools appropriate.

Landowners generally felt that negotiated easement agreements, with fair compensation paid for hosting transmission lines and restricting activities around the lines, would resolve the issues intended to be addressed by the transmission risks NES proposal. Such an approach would not impose costs and loss of property rights on landowners. One submitter suggested that Transpower should be given direction by Cabinet to do this.

3.8 Electric and magnetic fields

Nineteen submitters raised the issue of extremely low-frequency electric and magnetic fields (EMF) associated with high-voltage transmission lines. Submitters stated that the standards should address EMF through permitted activity terms and conditions and separation distances. They also suggested that clarification would be needed on the exposure limits to be used, and matters over which councils can exercise control or discretion. The general theme of these submissions was that locating occupied buildings under transmission lines should be avoided wherever possible in order to avoid potential health impacts. However, submitters differed in their views on the likelihood of exposure causing health impacts, appropriate exposure limits, and mechanisms for ensuring a corridor is established.

The National Radiation Laboratory (NRL) of the Ministry of Health supports protecting people against the effects of exposure to EMF through compliance with the internationally recognised International Committee on Non-Ionising Radiation Protection (ICNIRP) guidelines, and low or no-cost measures to reduce or avoid exposure. The NRL was not convinced that maintaining a corridor beneath transmission lines free of occupied buildings would be a “low or no-cost measure”. If a corridor were to be established for other reasons, such as electrical safety, then there would be additional benefits from reducing EMF exposure. The NRL supported giving greater weight to maintaining corridors clear of regularly occupied buildings, and adding consideration of minimising exposure to EMF fields to matters to which discretion applies. NZECP 34 separation distances for 220 kV lines may be greater than the 20 metres proposed in the NES, and this would further reduce exposure to EMF.

One NGO submitter proposed that the 100 microTesla (µT) magnetic field standard was out of date, and suggested that international best practice was now 0.4 µT and a 30-metre exclusion corridor. Another NGO submitter provided an extensive review of international research on the health effects of EMF. This submission also proposed that the 100 µT limit is out of date, and that it should be revised to 0.1 µT. The submission stated that no studies have been done on populations exposed to 100 µT because the field strength beneath transmission lines is generally at most 5 µT under the line, and possible effects have been observed at 0.4 µT. It went on to say that nationally imposed limits range from 100 µT and prudent avoidance in the UK, Australia and New Zealand, to 10 µT in Italy, and as low as 0.4 µT in the Netherlands.

One NGO submitter suggested that wider corridors should be imposed whether or not the adverse effects of EMF can be demonstrated, and quoted the recommendations of the UK Stakeholder Advisory Group on ELF EMF (SAGE) report in support of this suggestion. Three submitters noted that the Reference Group report in 2006 recommended incorporating part of the draft standard under development by the Australian Radiation Protection and Nuclear Safety Agency, but the proposed NES does not mention taking a precautionary approach, as recommended by the Australian body. Submitters felt that more national guidance is needed to assist local authorities. Two submitters proposed that practical precautionary steps should be investigated to reduce EMF exposure from existing lines (eg, phasing, radial circuits, undergrounding) in line with SAGE and World Health Organisation recommendations.

Nine submitters noted that the failure of the proposed NES to cover EMF was a weakness in the proposals, and these submitters proposed this should be corrected by reference to international guidelines (ICNIRP) or an agreed national standard. Submitters saw this as following logically from the policy on EMF in the proposed NPS.

Transpower noted that epidemiological research on the health effects of EMF is inconclusive, and that the ideal outcome would be for the perceived health effects to be managed in a way that establishes internationally recognised levels, promotes public confidence and provides guidance on compliance. The permitted activity terms and conditions limit the extent of upgrades, and Transpower supports this approach. Transpower has a corporate commitment to manage EMF, including designing new and up-rated infrastructure to meet ICNIRP guidelines and following prudent avoidance. Transpower consider that if an exposure limit were added as a condition for permitted activities, it would be difficult for council officers to easily assess. Transpower strongly opposed using ICNIRP guidelines as a permitted activity standard because the guidelines are not specific enough, and strongly opposed using limits on up-rating or capacity (MVA) limits to control EMF, as it would provide poor control. Councils need the ability, when assessing controlled and restricted discretionary activities that could result in an increase in carrying capacity, to assess whether any change in EMF would be consistent with the ICNIRP guidelines. Transpower consider that the potential for radiofrequency interference and electromagnetic interference is minor and does not need controlling in the NES.

3.9 Implementation issues

3.9.1 The implementation process

Twenty-nine submitters commented on the proposed NES implementation process. The main issues raised included financial aspects of the implementation of the standards, and creating new administrative and enforcement functions for local authorities.

In terms of the financial aspects of implementation, the majority of comments related to the transfer of costs from Transpower as line owner to councils and, in effect, to ratepayers. Seven local authority submitters pointed out that additional operational costs associated with monitoring and enforcement of the standards would be imposed at a local level. Therefore, as suggested by one of the territorial authorities, issues such as providing support for local government and effective analysis of costs and benefits at this level need to be addressed. One submitter suggested that implementation costs should be apportioned fairly between Transpower, and central and local government. Other local authority submitters noted that local authorities may not currently have the expertise required to implement the standards. One NGO pointed out that shifting responsibility − with funding implications but no clear benefit − to local government is inconsistent with the Department of Internal Affairs’ Guidelines for Regulatory Functions Involving Local Government.

Two regional councils commented on the implementation process, with one noting that monitoring and enforcement will be prioritised against other resource management issues once the proposed NES are in place. Several local government submitters emphasised the importance of a clear division of responsibilities for regional and district councils, especially with regard to earthworks, as this activity is covered by both types of councils (albeit for different effects). Clarification on boat ramps and damming/diverting water was also sought. One local authority queried the status of NZECP 34 if the proposed transmission risks NES were implemented.

Thirteen responses were received from landowners, with 11 claiming that the proposed NES implementation process will transfer responsibility to third parties and result in an increased number of RMA applications for activities currently permitted, and two noting the cost transfer from Transpower to local government and taxpayers. Transpower commented that given the complexity and novelty of the proposed NES and potential for future regulatory change, the Ministry for the Environment needs to commit to reviewing the NES at regular intervals.

Six comments were received from individuals and NGOs on this issue. Two submitters acknowledged the need for regular reviews to allow for enhancing the standards and taking account of technological advances, and one noted that new responsibilities for local authorities to regulate and administer the standard will be created. One submitter emphasised the transfer of compliance and enforcement costs to regional and local authorities. Another respondent, apart from acknowledging the shift in responsibilities, suggested that the cost of altering district or regional plans can be minimised if the timing of the introduction of the proposed NES coincides with the second-generation plan reviews.

One individual and two NGOs noted that the RMA does not allow for standards to be incorporated into plans without going through a consultation process, and suggested that a change to the Act to allow this would assist council implementation. One territorial authority noted that the format of the proposed standards in the discussion document is inconsistent with most plans.

The effect of the proposed standards on designations was also mentioned as one of the matters to be addressed and clarified, as well as the potential for creating a “permitted baseline” for other activities that involve overhead wires and support structures.

3.9.2 Guidance

Submitters requested specific guidance on some aspects of the proposals, and raised a number of issues in relation to the proposed standards that could be addressed through guidance.

Thirteen submitters indicated the need for NES guidance in order to specify the range of duties for local authorities, and to provide detailed information on the notification of resource consents, managing adverse effects, evaluation of risk and transmission activities and related matters.

Regional councils were particularly concerned at the absence of a clear distinction between functions carried out by territorial authorities and those carried out by regional authorities. Submitters noted that there may be a great deal of confusion over who is the responsible authority for NES compliance and enforcement issues, particularly for activities such as earthworks and abrasive blasting.

Territorial authorities were mainly concerned with the lack of clarity over what happens if there is a difference between the proposed NES and plan definitions, and sought guidance on notification of consent applications, affected party status and whether existing plan notification requirements will apply. One territorial authority suggested that providing explanations and anticipated outcomes for each activity covered by the proposed NES would help the assessment of resource consent applications. Another noted that assistance would be needed to educate the public about any new standards.

One of the territorial authorities wanted guidance on determining the status of emergency works under the proposed NES. Another noted that guidance on the potential adverse effect of electromagnetic fields will be required.

One local government representative suggested that guidance is also needed on which activities are “directly associated with the inspection, operation, maintenance or enhancement of an existing transmission line”, as well as on consent requirements for projects where activities fall within more than one category. This submitter suggested that providing examples of how the proposed NES should be applied to projects would be of great assistance to local authorities.

Landowners were interested in receiving more explanation on how their existing-use rights will be affected by the introduction of the proposed NES.

A number of submitters requested that a number of definitions included in the discussion paper be clarified. According to one of the regional councils, terms such as “operation”, “maintenance” and “upgrading” need to be clarified to avoid confusion. A unitary authority noticed that two definitions were given for “earthworks”, and that the definition for “building or structure” was uncertain and unworkable. Another remarked that the definitions provided were likely to be different from local authority plan definitions.

One of the local authorities suggested that visual aids (eg, diagrams, illustrations, etc.) should be used to explain technical terms.

Transpower expressed a readiness to work in partnership with the Ministry for the Environment and Local Government New Zealand in preparing guidance material and assisting with the implementation of the proposed standards. Suggested topics included:

• the intention and scope of the NES

• clarifying the relationship with district and regional plans (eg, earthworks)

• applying the NES requirements to projects

• technical terms, transmission components and functions and transmission activities

• giving examples of standard conditions

• providing guidance on specific NES topics such as noise, EMF, historic heritage and vegetation

• identifying best practice for cultural, heritage and archaeological site disturbance

• clarifying controls in the CMA, lakes and rivers, and guidance on duration.

For the proposed risks NES, Transpower considered guidance would be needed on:

• activities outside the NES but which may still adversely affect transmission lines

• the relationship between NES requirements and plan requirements.

3.10 Process and consultation

Thirty-four comments were received on the proposed NES process and consultation.

Eighteen comments were from landowners, most of which pointed out issues with the consultation process, such as:

• inadequate notification of landowners

• insufficient time available to comment on the proposals

• no hearings and no opportunity to present evidence in support of submissions

• no opportunity for making further submissions or Environment Court appeals.

A lack of awareness among landowners about the ongoing consultation process due to inadequate notification (only one public notice in each area) was signalled as being a major drawback in the process. Two submitters suggested that landowners were not well represented on the original Reference Group. The number of workshops conducted was also felt to be too small. Several respondents thought that all affected landowners should have been directly notified of the proposals.

Ten comments were made by individuals and NGOs, with three suggesting there should be provision for further input once the submissions are received and opportunity for review and comment on the draft regulations before their formal propagation. One submitter suggested the consultation process should be tailored for each of the proposed NES separately, and should be more transparent and accountable. Another NGO noted the need for a more equitable process, where provision for the participation of landowners and other interests is more inclusive and a rural impact assessment is incorporated into the process. One individual noted that consultation with the “many sovereign Maori nations and their interests and relationship to sites of importance” was not provided for. Conducting public hearings was also suggested.

Four comments on the NES process and consultation were received from territorial authorities. One suggested that a second round of consultation and wider workshop sessions should be considered in order to add transparency to the process, and one was concerned about the level of consultation undertaken. One territorial authority felt the process was unsatisfactory and suggested submitters have the opportunity to comment on a revised draft. One regional council also noted that good practice would involve notifying landowners adjacent to the existing lines so that they could be fully involved in the consultation process.

One electricity industry submitter acknowledged that the proposed standards are complex and highly technical and requested an opportunity to review the draft regulations for workability, clarity and certainty. Several local authorities also asked to be involved in preparing the final NES proposals.

3.11 Links with the National Policy Statement on Electricity Transmission

A National Policy Statement (NPS) on Electricity Transmission was gazetted on 13 March 2008, and the rules took effect on 10 April 2008.

Ten submitters stressed the importance of the proposed NES being aligned with the NPS on electricity transmission. Although views on implementation issues varied, it was clear that submitters considered that ensuring the standards are consistent with national policy direction is paramount.

In terms of NPS and NES implementation, three submitters said it would be preferable to publicly notify the NPS at the same time as the proposed NES. Four submitters suggested the NPS should be finalised and implemented prior to the NES introduction. One noted there should be a second round of comment on the NES once the NPS is in place.

One electricity industry submitter proposed that the NES should incorporate the national policy direction following the final report on the NPS. One territorial authority suggested that once the proposed NPS on electricity transmission is finalised, consideration should be given to ensuring the proposed standards are still in accordance with the framework of objectives and policies outlined in the NPS. One regional council noted that changes requested to the proposed NPS − such as minimising adverse effects on urban amenity, town centres and areas of high recreational or amenity value − should be taken into account in the NES once the NPS is finalised. One submitter saw the NPS requirement to show transmission lines on planning maps as complementing the NES proposals.

According to one regional council, the discussion document on the proposed NES does not indicate in any way how the proposed standards support or link with the strategic national direction of the NPS. Moreover, one of the landowners claimed the discussion document is “ambiguous and confusing” on the relationship between the proposed NES and the proposed NPS, and their implementation.

However, in general the submissions recognised the importance of the NPS and the proposed NES being closely aligned and consistent with each other if they were to provide effective and robust industry direction.