Key Details

• If elected, Opportunity will establish a ring-fenced Industry Energy Resilience Fund (IERF) to help New Zealand industry electrify, covering both plant capital costs and the grid connection and network upgrade costs that currently block electrification.

• The fund will be capitalised by a $1 billion green bond raised against a conservative projection of ETS auction revenues over the next decade, with all future revenues legislated to finance the bond and then to sustain the fund.

• Unlike GIDI, the IERF will not be a grants-only fund. It will deploy the mix of instruments EECA suggested after consulting the market — concessional loans, energy savings guarantees and loan underwriting — with grants reserved for smaller, targeted uses: engineering reviews and project planning, and network connection costs.

New Zealand industry is being squeezed from two directions. Gas reserves fell 23 per cent in a single year to 731 petajoules, Methanex is being idled, and the Climate Change Commission has found that "beyond the remaining GIDI projects, there is no policy to drive another wave of projects" for the third emissions budget. 

The Government scrapped GIDI and redirected approximately $640 million of funding. Its replacement, $48 million to fund a loan guarantee scheme, has fallen short because a purely loan-based scheme cannot overcome the upfront cost, debt constraints and investment risks that prevent many industrial decarbonisation projects from proceeding. It is not delivering the scale or pace of emissions reductions that GIDI achieved or that New Zealand now requires.

Money From Pollution Should Pay For Its Own Cure

Every dollar the Crown collects from selling carbon units is a dollar collected from climate pollution. It should not disappear into the consolidated fund. Opportunity will direct all Crown ETS auction revenues into the IERF and ring-fence them by statute, so businesses, banks and equipment suppliers can plan a decade ahead instead of guessing which fund survives the next Budget. Because the work is urgent, we will raise a green bond against a conservative ten-year projection of those revenues: $1 billion invested now, while boilers are being replaced anyway and while the gas supply problem is acute, rather than a trickle arriving after decisions have already been made.

The success of IERF depends on a well-functioning ETS. Opportunity will restore the integrity and impact of the ETS by implementing changes that create a credible, rising price path that drives decarbonisation across the economy. This will be set out in our Climate Action policy.

A Toolkit, Not A Chequebook

GIDI had one instrument: the capital grant. That is why it attracted the criticism that it was paying for projects that would have gone ahead anyway, and writing large cheques to firms that were already profitable and already receiving free carbon credits. EECA’s 2025 green paper Updates to EECA's targeted investment approach proposed moving beyond capital grants to three mechanisms: concessional loans, energy savings guarantees, and loan underwriting. The IERF will implement that advice and make use of:

• Concessional loans for the bulk of industrial electrification capital spending. Long-tenor, below-market lending matched to the life of the asset, so a mid-sized processor can replace a coal boiler without the payback period killing the business case. Because the money is repaid, the cash principal can be recycled into successive waves of projects rather than spent once.

• Energy savings guarantees, piloted on projects where savings are measurable, so that where a firm's hesitation is uncertainty about whether the promised energy savings will actually materialise, the Crown carries that performance risk instead of the business. The timing and structure of these guarantees would be linked to the Capacity Investment Scheme mechanism Opportunity has proposed to support renewable generation expansion in our Abundant Energy policy 

• Loan underwriting used selectively for capital-constrained firms and higher-risk projects, complementing rather than duplicating the existing Gas Transition Loan Guarantee Scheme.

• Grants, deliberately smaller and targeted for: engineering reviews, feasibility and project planning; and network connection and upgrade costs (funded in conjunction with the Electricity Authority’s Pioneer Programme). These are the two things the market will not fund on its own and where a modest public contribution unlocks disproportionate private investment.