NZ agriculture may dodge ETS without new technology, global buy-in, National says

Wednesday 9th November 2011

A National-led government may exclude agriculture from New Zealand’s emission trading scheme if new practical technologies to cut emissions and buy-in from the nation’s trading partners don’t emerge by 2015.

Prime Minister John Key released his party’s environmental policy in Nelson today, which pledges to review the Jan. 1, 2015 inclusion of agriculture to the scheme in 2014.

The policy says the nation’s biggest emitting sector won’t face a liability “unless there are practical technologies to reduce emissions, and our trading partners have made further progress with their climate change policies to reduce emissions.”

That comes after the ETS review panel, led by former Finance Minister David Caygill, could find no reason to exclude agriculture in its September report to Climate Change Minister Nick Smith.

Other changes will see a National-led government give transport, electricity and industrial sectors another two years transition period to prepare for full obligations under the ETS to 2015, following the Caygill panel’s recommendation. It will also keep the carbon price fixed at $25 a tonne until 2015.

“Our climate change policies carefully balance the costs to households and businesses with the need to reduce greenhouse gas emissions,” Key said in a statement. “That is why we intend to slow the phasing in of the emissions trading scheme from 2013 to 2015, at which point we will look to align our scheme with that adopted by Australia.”

The announcement comes just one day after Australia’s Senate passed the Federal Government’s carbon tax, which will charge about 500 companies A$23 a tonne for their carbon emissions from July next year.

A National-led government will also introduce offsets for pre-1990 forest owners from 2013 and allow those forest owners to change how they use their land without penalty provided they allow for an equal level of carbon sequestration by planting elsewhere, the policy statement said.

BusinessDesk.co.nz

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