Emissions and goods prices for Aucklanders to rise if port moved north - report

The decisions on whether, where and how to move Ports of Auckland should be handed to the Infrastructure Commission, the port's chief executive says.

A Institute of Economic Research (NZIER) report is the latest in a string of studies looking into moving the city's freight operations to Northport in Whangārei and comes at a time when the government is also considering the port's fate.

It found New Zealanders would pay up to $626 million more a year for imports if the city's freight operations were moved to north.

There has been fierce debate over the port's future since the New Zealand First leader Winston Peters vowed two years ago to move it to Northland.

The campaign for such a shift is now backed by former ministers Helen Clark and Sir John Key.

Cabinet is about to consider a report commissioned the Regional Development Minister Shane Jones, which recommends moving freight operations north.

Ports of Auckland's chief executive Tony Gibson now says a proper cost-benefit analysis should be done but says he, like many Aucklanders, is sick of the endless reports, and if action is needed now the whole project should be handed over to the Infrastructure Commission.

The Cabinet Economic Development Committee is meeting today and campaigners supporting the port's move to Northland expect it to be on the agenda.

What's in the latest report

NZIER chief executive Laurence Kubiak said losing the port would hit New Zealanders in the pocket.

"We've made quite a bold assumption really ... this is just a thought experiment. We've assumed that Tauranga could handle all the extra volume and so could Northport [so] there wouldn't need to be any other investment made in the infrastructure between those locations and Auckland," he said.

He said a family of four would pay up to $1400 a year more for imported goods.

"Today, the price that you pay at the shop only has to include some return to freighting it in from the Ports of Auckland to wherever your shop is.

"Instead of that situation, you would have to pay for bringing it in from say Tauranga, which is much further. The price you would have to pay would recognise that."

He said all New Zealanders would bear the brunt, not just Aucklanders.

"What we have to remember is the role that Auckland plays within the New Zealand economy, so it's roughly a third of the people, it's just over a third of the economic activity.

"So there's a concentration effect that attaches to Auckland that you just don't see anywhere else in the country which is another point in favour of having a port in the close proximity to Auckland."

Carbon costs to moving port

The report suggests carbon emissions would rise because trucks would have to travel much further - from either Tauranga or Northland - to reach Auckland. The report estimated about 212,000 tonnes of extra carbon dioxide annually if all the traffic were moved to the road from Tauranga.

Port chief executive Tony Gibson said that was at odds with the aims of the Zero Carbon Act and was not wise given the urgent need to tackle climate change.

Mr Kubiak admitted the report did not factor in reduced emissions if a new rail line was put in.

However, Mr Gibson said estimates were that moving the port would increase emissions 400 percent even if 70 percent of the freight was moved to diesel rail, and considering the government's carbon zero bill it would be irresponsible to do.

Calls for cost-benefit analysis

Mr Kubiak urged the government to do thorough investigation of all the benefits and costs before making any decision.

"There are quite a number of opposing views as to what the benefits could be because nobody's really clear as to what the counter-factual for the use of that land down on the waterfront could be," he said.

He said he felt very strongly that a cost-benefit analysis was needed.

"We haven't had one. If we can't do that then a cost effectiveness study would be the next best thing, and they've used that very successfully for the container port in Melbourne."

Mr Gibson agreed, and said it was important to let experts gather the facts and undertake an objective analysis.

"And that has not been done, and what's more the results of that experts' work - especially the assumptions, and the models - should be made public to allow stakeholders to have both confidence in the analysis and to independently verify it.

Mr Kubiak said it was hard to see how moving the port to Northport could work.

"Stimulating economic development in northland is not in and of itself a good reason for removing an efficient port from Auckland - remember most of the country live south of Auckland so you would be putting the port at one end of the country and just moving the stuff further down the country if you were to do that.

"It's pretty hard to see the case for Northport I would say, but we need to do the work.

"You observed a couple of weeks ago the Upper North Island supply chain study commissioned by the government which advocated quite strongly for Northport, but you know we've got quite strong reservations about the gaps in some of the analysis in that study. As I say, we need a rigorous cost-benefit study ... so that the taxpayer knows just exactly where they stand."

Mr Gibson also said the current analyses were flawed.

"We've commissioned NZIER and Costelio - two leading economic firms - to undertake a peer review of EY's economic analysis and our conclusion is that it's flawed and dangerous.

"It doesn't include cost to consumers. There's no evidence for growth. Tight cargo categories have been overlooked. There's no sensitivity for critical elements like road and rail. Road impacts are not fully considered. So you might say our analysis is flawed but what I would say is that what we're trying to do is actually produce some facts so that the decision makers can make a decision."

Too many reports?

Mr Gibson acknowledged that many reports had been done into the port relocation.

"We were involved in a new study a few years ago, which said 'in 30 years, the port might run out of room and it may need to move' ... two options were provided in that report, which was the Firth of Thames and Ōnehunga.

"The same consultant has now released a report which brings Northport to number one on the agenda, where it was the 12th choice out of 14 in the previous report."

He was also calling for a complete cost-benefit analysis.

"We think that there is sense in thinking about how and when we move - and that could be in 20 to 30 years time and we've been waiting three years for report - which was going to be on the back of the previous report - which also included the analysis on Ōnehunga and Firth of Thames, and that did not happen. So we've wasted three years, another three years."

He said time constraints were also a problem, and despite calls for the port to move in 10 to 15 years did not think that likely.

"I can't see how you could move a port in 10 to 15 years. I mean, it's just absolutely impossible and that's why we agreed that 30 [year] horizon was the most appropriate and we would invest accordingly.

One recent estimate found 60 percent of Aucklanders were now in favour of moving the port. Mr Gibson said he too was sick of all the reports.

"This is, in my eight years at Ports of Auckland, this is my fifth port study. So I'm getting a bit sick of studies as well."

He said in the absence of a full cost-benefit analysis, and if action was needed without doing more reports and research, the decision should be handed to the Infrastructure Commission.

"That's what I would do. I think they've got the brains and the methodology to actually handle it and I think that they would also provide assumptions and models and data that can be independently verified with confidence and allow decision makers to make decisions because it will be based on facts.

"That's what I would recommend."