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National climate change policy realistic, should go further

National’s climate change policy realistic but should go further to help businesses, consumers

9 November 2011

The National Party’s climate change policy acknowledges the reality of slow international action on carbon pricing, but still exposes consumers and businesses to increased costs, the Greenhouse Policy Coalition said today.

“We are pleased to see the Government will continue the $25 fixed price cap until at least 2015. This will provide some certainty around ETS costs beyond the current expiry date for the fixed price at the end of next year. It is good to see the Government has acknowledged the risk to New Zealanders of carbon price rises and has rejected the ETS Review Panel’s recommendation to ramp up the cap each year after 2012,” says the Coalition’s Executive Director, David Venables.

“However, phasing out the 50% carbon unit surrender obligation from 2013-2015 will see ETS costs increase for New Zealanders through fuel and power price rises over those years. We think the 50% obligation should simply be continued for those three years. We do not believe the Government’s own conditions for ramping up the ETS in this way have been met, namely increased action by our main competitors.

“We welcome the Government re-stating the conditionality of its 2020 emissions reduction target range. We agree the target should only be adopted if there is a commitment from major emitting countries to reduce their business-as-usual emissions levels. Such a commitment would have to be binding.

“The decision to review the entry of agricultural gases into the ETS in 2014 is sensible as is the Government’s conditionality on making such a move.

“We note the Government’s desire to link with an Australian ETS from 2015, but would caution against pursuing this too strongly. The Australian scheme, should it be durable, would be very different from ours, not least of all because the Australian Government is seeking to compensate most households against feeling any cost impacts, unlike in New Zealand where households and businesses are paying more for fuel and power,” says David Venables.

ENDS

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