Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Big carbon emitters to lose ETS subsidy: Bennett

Big carbon emitters to lose ETS subsidy: Bennett

By Pattrick Smellie

March 16 (BusinessDesk) - Big industrial emitters of greenhouse gases will lose their right under the emissions trading scheme to offset only half of their emissions, Climate Change Minister Paula Bennett told an international energy conference in Wellington today.

It was a matter of "when not if" the so-called 'two-for-one" concession is removed, she said, leaving open the impression that the current $25 a tonne upper limit "cap" on carbon prices may also be removed or placed at a higher level.

"It was always a temporary measure," said Bennett of the two-for-one measure. "It is abundantly clear that if the ETS is going to work, carbon must cost more than it does right now."

It appears the widely expected decision has not yet been made formally made by the Cabinet, but Bennett said she expected to conclude the review of the ETS within "the next couple of months".

Most affected by the decision are likely to be the electricity and transport fuels sector because the removal will double the cost of offsetting the carbon emissions from burning coal, natural gas, petrol and diesel.

The price of carbon in the New Zealand scheme has already been rising towards $11 a tonne in anticipation of such a decision after collapsing to below 50 cents a tonne for a period after 2011, when New Zealand emitters had access to carbon units from international markets. That access has since ended, meaning major emitters can only buy carbon as New Zealand Units (NZUs) under the local ETS.

"This will have a direct impact on every part of the economy," she said, without nominating the impact on electricity, gas or petrol prices. "Whether it’s forestry, farming, households or the transport sector, the effects of the decisions we make will be widespread."

A transition period lasting several years has been mooted for the two-for-one removal, which is seen as vital to raising carbon prices to a level capable of encouraging forestry plantations, which soak up carbon from the atmosphere and are an essential element of New Zealand's plan to meet its long-term greenhouse gas emissions reductions targets.

The impact of the ETS on New Zealand's emissions had been limited "due to the artificially low carbon price, which the government instituted following the global financial crisis so as not to further cost businesses that were already struggling," Bennett said.

"I’m currently considering the options and potential implications of removing these artificial measures, including pricing emissions units at two-for-one, and the cap of $25.

"As some of you might have seen me say already, this isn’t really a case of ‘if’, but more ‘when and how’."

"If New Zealand is going to take the next steps to tackle climate change, we’re going to have to see more investment in tree planting and big emitters making a greater contribution to our efforts," Bennett said.

Carbon trader OMF was quoting NZUs trading at $10.75 a tonne this morning, having gone as high as $10.85 in the last day, and says $11 a tonne by the end of the month is possible. A carbon price of $15 a tonne is regarded as a trigger price for forest planting.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Cosmetics & Pollution: Proposal To Ban Microbeads

Cosmetic products containing microbeads will be banned under a proposal announced by the Minister for the Environment today. Marine scientists have been advocating for a ban on the microplastics, which have been found to quickly enter waterways and harm marine life. More>>

ALSO:

NIWA: 2016 New Zealand’s Warmest Year On Record

Annual temperatures were above average (0.51°C to 1.20°C above the annual average) throughout the country, with very few locations observing near average temperatures (within 0.5°C of the annual average) or lower. The year 2016 was the warmest on record for New Zealand, based on NIWA’s seven-station series which begins in 1909. More>>

ALSO:

Farewell 2016: NZ Economy Flies Through 2016's Political Curveballs

Dec. 23 (BusinessDesk) - New Zealand's economy batted away some curly political curveballs of 2016 to end the year on a high note, with its twin planks of a booming construction sector and rampant tourism soon to be joined by a resurgent dairy industry. More>>

ALSO:


NZ Economy: More Growth Than Expected In 3rd Qtr

Dec. 22 (BusinessDesk) - New Zealand's economy grew at a faster pace than expected in the September quarter as a booming construction sector continued to underpin activity, spilling over into related building services, and was bolstered by tourism and transport ... More>>

  • NZ Govt - Solid growth for NZ despite fragile world economy
  • NZ Council of Trade Unions - Government needs to ensure economy raises living standards
  • KiwiRail Goes Deisel: Cans electric trains on partially electrified North Island trunkline

    Dec. 21 (BusinessDesk) – KiwiRail, the state-owned rail and freight operator, said a small fleet of electric trains on New Zealand’s North Island would be phased out over the next two years and replaced with diesel locomotives. More>>

  • KiwiRail - KiwiRail announces fleet decision on North Island line
  • Greens - Ditching electric trains massive step backwards
  • Labour - Bill English turns ‘Think Big’ into ‘Think Backwards’
  • First Union - Train drivers condemn KiwiRail’s return to “dirty diesel”
  • NZ First - KiwiRail Going Backwards for Xmas
  • NIWA: The Year's Top Science Findings

    Since 1972 NIWA has operated a Clean Air Monitoring Station at Baring Head, near Wellington... In June, Baring Head’s carbon dioxide readings officially passed 400 parts per million (ppm), a level last reached more than three million years ago. More>>

    ALSO:

    Get More From Scoop

     
     
     
     
     
     
     
     
    Business
    Search Scoop  
     
     
    Powered by Vodafone
    NZ independent news