Up until the mid-1980s, New Zealand had been characterized by an economy that was heavily protected, extensively regulated and in which production was subsidized to a considerable extent. In 1984 the government embarked upon a programme of extensive public sector and economic restructuring, described by some as being among the most wide reaching and radical in New Zealand's history. For the energy sector, the restructuring has meant a move away from an administrative infrastructure of the 1970s and 1980s that was strongly centralized and government led to one that is based much more on market forces. Energy development, production and delivery have been corporatized and privatized, the energy sector has been largely deregulated and government has disavowed itself of responsibility for energy resource management and policy. The primary motivation that underlies all of the reform is economic efficiency. Concerns are widely held, however, for the implications that follow from this restructuring of the energy sector for the efficient management of energy resources, security of supply, long-term management of the sector, and for the maintenance of environmental quality. It is possible that greater economic efficiencies might be achieved, although this is by no means certain, but it would seem that specific characteristics of the restructuring will militate strongly against the achievement of other objectives in the sector. Recommendations for amendment refer to the need to strike a sensible balance between market forces and government involvement.
