Blank Canvas On Kyoto Implementation Welcomed

KFA Welcomes Government Blank Canvas On Kyoto Implementation

New Zealand can now get on and develop an effective way of implementing its Kyoto obligations after the new Government’s common-sense move on the carbon tax, the Kyoto Forestry Association (KFA) said today.

“Climate change is a major threat to the world and it is widely agreed that the Kyoto Protocol offers the best international means of tackling it,” KFA spokesman Roger Dickie said today.

“The best way to implement Kyoto is with market mechanisms that provide financial incentives to those who reduce pollution or plant trees, while disincentivising those who continue to pollute.

“It is good news for the environment and for the economy that new Climate Change Minister David Parker, with the support of Revenue Minister Peter Dunne and Foreign Minister Winston Peters, has moved swiftly on these matters.

“Along with the positive approach to forestry issues promoted by Forestry Minister Jim Anderton over recent months, the new Government is sending all the right signals that it wants to take a forward-looking and pragmatic approach to Kyoto and forestry issues.

“With today’s announcement, there is a now a blank canvas on which more effective climate change and forestry policy can be developed. The Kyoto Forestry Association looks forward to continuing to work with officials and the Government to develop that policy.”

The Kyoto Forestry Association represents forest owners who have planted more than 200,000 hectares of new forestry in New Zealand since 1989. According to the Government, these trees will generate approximately $2.6 billion in Kyoto carbon credits during the first Kyoto commitment period from 2008 to 2012. Under the Government’s now-abandoned tax-and-subsidise approach to Kyoto, these credits were to be expropriated by the Crown and used in part to subsidise SOEs and other large polluting businesses.

Through 2005, KFA has campaigned for these credits to remain in the ownership of those who have risked their capital by planting the trees associated with them, as originally envisaged by the architects of Kyoto and as earlier promised by New Zealand Government officials. KFA believes this would encourage investors to return to the industry, restoring tree plantings and New Zealand’s forest cover. Tree plantings in New Zealand have plunged to zero since the Government announced the expropriation of the credits, down from over 65,000 hectares per annum in the 1990s. As well as the environmental consequences, this has also cost around 8,000 jobs.

The New Zealand Treasury broadly agrees with KFA’s recommended approach to implementing Kyoto. In its Briefing Notes to the Incoming Government, Sustaining Growth: Briefing to the Incoming Government (pp 13-15), the Treasury urged the Government to use market mechanisms to implement Kyoto and battle climate change, saying there should be:

Increased reliance on price-based measures – either through emissions trading or a reconfigured carbon tax, applying to as many greenhouse emitters as possible, and with no or few exemptions. The effect of such price-based measures will be to bring about structural change in the economy towards activities with lower carbon emissions. In the medium term, it is likely that it will be most efficient for New Zealand to adopt some form of emissions trading.

Devolution of a very large part of New Zealand’s climate change obligations to firms and individuals, and allowing markets to determine the most efficient way for New Zealand to meet its emission reduction goals. This could include the devolution of forest sink credits, and all international obligations for deforestation to the forestry sector.

A strategy for appropriate use of international emissions trading and the other Kyoto flexible mechanisms. Using emissions trading early would allow New Zealand to buy the time to plan for long-term mitigation strategies.

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