The Commerce Commission rejected a complaint that fuel retailer Z Energy had breached the Fair Trading Act by using “greenwashing” in its marketing.
Lawyers For Climate Action NZ complained to the Commerce Commission in August that the country’s largest fuel retailer Z Energy had breached the Fair Trading Act in its ‘Moving With the Times’ campaign. Z Energy rejected the accusation.
Commerce Commission general manager of fair trading Vanessa Horne said an assessment of the complaint did not find any potential breach of the Act, although only the courts could determine that.
The climate action group claimed Z Energy’s campaign, which positioned the fuel retailer as part of the transition away from fossil fuels, was misleading and irresponsible.
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Group president Jenny Cooper said Z Energy’s campaign was part of a worldwide trend where fossil fuel companies, which were fuelling climate change, were trying to boost business by painting themselves as part of the solution when they were not. Greenwashing is an attempt to make a business appear more climate-friendly than it really is.
Z Energy chief executive Mike Bennetts said the company was not greenwashing.
“We think really carefully about what we say and how we say it – we are a very transparent company,” he said. “We talk about what we are doing to support the change to a low carbon future. We talk openly about our failures or when things don’t go according to our original plans.
“This is a really big problem. We as a country are not changing quick enough, and we acknowledge our role in that,” Bennetts said.
Cooper criticised Z Energy’s promotion of its carbon reduction plans, noting it had closed its biofuel manufacturing plant, would only have EV chargers in 14 of its 286 stations by the end of this year, and its move into electricity retailing would not have much of an impact on carbon emissions.
Z Energy’s Bennetts said the company existed to serve its customers and had to work with them to transition to lower carbon alternatives.
He said the company had invested $50 million in a biofuel plant which it had to hibernate as the feedstock had risen in cost, making it uneconomic for customers.
While increasing the cost of fuel would help lower emissions, transitioning to an electric vehicle was not affordable for a customer driving a 20-year-old Toyota, he said.
“We’re doing what we can where we can with our customers, and many of our customers are saying to us the alternatives are not economic enough for them,” he said.
“It would be at one level nonsensical for us to stop selling petrol, diesel and jet to all of our customers because it actually doesn’t solve the problem – that just means someone else supplies it.”
The company had invested in car sharing service Mevo, and was importing more sustainable aviation fuel from Europe for Air New Zealand. It was adding electric charging units to its new service stations, as well as replacing existing units with rapid chargers that could charge a vehicle up to about 80% within 15 minutes, compared with the current rate of more than an hour.
Still, most electric vehicles would be charged at a driver’s home, office or shopping mall, rather than “on the go” so it didn’t make sense to convert all service stations, he said.
Bennetts rejected claims the company was telling its investors and customers different messages about its carbon reduction plans, saying all its investment materials were public.
“When we talk about optimising our core business…we talk about using the core business, which is the fossil fuels business, to generate the cash that we can then use to invest in the alternative to fossil fuels like hydrogen, biofuels and electrons,” he said, noting the company had spent more than $100m investing in the transition to a low carbon future over the last decade.
Cooper said Z Energy had told investors that it wasn’t meeting its carbon reduction targets as quickly as it would like to, and that it doesn’t plan to reduce fuel sales in the next decade, or forecast them to fall.
“The company is putting on a climate-friendly front in the campaign, misleading customers to think it is OK for them to purchase fuel from them, because of the climate-friendly actions it is taking,” she said.
“On the other hand, it is telling investors that there is a risk to shareholder value by rushing into climate action, and its preference is to keep its options open for as long as ‘reasonably possible’. This just isn’t right, and especially not when the stakes are as high as having a safe planet to live on or not.”
Cooper said big companies such as Z Energy needed to be held to account, and needed to be honest with what they were actually selling.
“Playing with the hearts and minds of consumers who are concerned about climate change and trying to do the right thing for the planet is unethical and we want to see some strong action taken,” she said.
Bennetts said he understood the frustration directed at the fuel retailer.
“I actually think it’s good that people hold us to account, that they don’t let us stray into the realms of greenwashing, that they do demand more from us,” he said.
“I’m up for that. We don’t pretend that shouldn’t happen, or it’s a bad thing. It’s entirely understandable, given the size of the challenge that we all have.”
The Commerce Commission said it was an evolving area which it will continue to follow with interest, and it would be using the information for intelligence purposes and to feed into its future work.
Z Energy was taken over by Australian fuel retailer Ampol in May for just under $2 billion.
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