Fossil fuels, used to supply process heat for industrial businesses like factories, result in over 8 million tonnes of CO2 or over quarter of the country’s overall energy emissions per year.

Decarbonising process heat used by New Zealand’s largest emitters is critical. Large projects of national significance are needed to help meet our emissions budgets.

Unlocking emissions reduction projects from the largest energy users frequently requires a bespoke partnership approach. It can also involve working with those involved in an energy user’s supply chain, and operating environment.

The programme was confirmed as part of expansion of the GIDI Fund in Budget 2022.

Partnerships are critical to success at the scale needed. GIDI co-funding helps accelerate action and deliver larger and earlier emissions reductions for New Zealand.

Nicki Sutherland, EECA Group Manager Business

How the co-funding is applied

EECA works alongside New Zealand’s largest emitters to explore the opportunity for reducing their reliance on fossil fuels – both from a technical and economic perspective. This results in an agreement aligned to the same Investment Principles that apply across all GIDI co-funding.

Emissions reduction, value for money, and proof of additionality are central to a project going ahead.


Key benefits of large energy user partnerships

  • A significant contribution to the decarbonisation of New Zealand’s economy, especially over the next two emissions budgets
  • Enabling a focus on long term decarbonisation
  • Maximising private investment in decarbonisation projects
  • New Zealand’s renewable energy resources will be used as efficiently as possible
  • Support for a fair and just transition across all sectors and regions
  • Early adoption of technologies with wide potential for replication by business
  • Lessons learned and shared with other New Zealand businesses supporting our transition to renewables at a national level

Co-funding to date

NZ Steel

The Government is partnering with New Zealand Steel to co-fund an electric arc furnace to replace the existing steelmaking furnace and two of the four coal-fueled kilns. This will deliver New Zealand’s largest emissions reduction project to date, with half of the coal being used at Glenbrook steel to be replaced with electricity to recycle scrap steel.

Read the press release:

NZ's biggest ever emissions reduction project unveiled(external link)


The Government is partnering with Fonterra to support a 50% reduction in the dairy company’s emissions by 2030 – increasing the existing target of 30%. The complex decarbonisation programme focusses on coal and will span multiple Fonterra sites and projects. It is anticipated the projects will include a combination of energy efficiency, biomass, existing heat pump technology and newer innovative solutions to deliver these reductions.

Read the press release:

Government partners with Fonterra to cut coal use & boost NZ’s climate credentials(external link)

Find out more about Approved GIDI projects

Explore alternative opportunities

Explore alternative EECA co-funding and support available.

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