The Infrastructure Commission advised the Government to slow its pursuit of a liquefied natural gas (LNG) import facility, citing concerns over potential cost blow-outs and the availability of less expensive alternatives. According to a December 2025 memo released under the Official Information Act, the commission questioned the project’s necessity for managing “dry-year” electricity risks and recommended a more thorough independent assessment of the plan.
Why the Infrastructure Commission raised concerns
The commission’s internal analysis identified significant gaps in the Government’s planning process. Advisors noted that the LNG option was developed in more detail than the 11 other alternatives considered, preventing a balanced comparison. The commission warned that the project, which could represent a $2.4 billion investment over 15 years, lacked a “base case” for comparison against the status quo. Furthermore, the commission expressed doubt that the facility would lower electricity prices, highlighting the “inherent volatility” of LNG markets and the risk of cost escalations typical in major infrastructure projects.
Government response to the feedback
Energy Minister Simeon Brown and the Ministry for Business, Innovation and Employment (MBIE) have maintained their support for the LNG terminal. In a Cabinet briefing, MBIE officials acknowledged the trade-off between speed and effectiveness but argued that an expedited process was necessary. Minister Brown stated that MBIE had examined nearly a dozen alternatives and concluded that LNG is the most viable option to address a 1.5 terawatt-hour generation gap. Brown described the potential economic consequences of a dry year without this backup as “catastrophic” and argued that the government lacks the “luxury of waiting” for other solutions to emerge.
Conflicting views on the necessity of the project
The debate over the LNG facility centers on the urgency of the “dry-year” risk. Recent modelling commissioned by MBIE, revealed by RNZ, suggested there was “low need” for the facility and, in some scenarios, no need at all. Labour Party energy spokesperson Megan Woods argued that the government is refusing to properly compare the LNG plan against other available options, such as demand-shifting measures identified in an earlier EECA report. Meanwhile, Lawyers for Climate Action spokesperson Laura MacKay claimed the government is proceeding with “blinkers on,” ignoring calls to pause and conduct a more rigorous evaluation of costs and benefits.
What could happen next
As the project progresses, the government is expected to conduct further analysis of accelerated proposals throughout 2026. Because the Infrastructure Commission has not received detailed updates since its December advice, it remains unable to provide further assessments. If cost volatility persists or if electricity market conditions change, the government may face continued pressure from opposition parties and advocacy groups to justify the multi-billion-dollar expenditure against alternative, smaller-scale energy interventions.
