Wednesday 05 October 2016 09:14 AM
NZ ratifies new global climate change pact as carbon heads for $20 a tonne
By Pattrick Smellie
Oct. 5 (BusinessDesk) - New Zealand has become one of the first batch of countries to ratify the new global climate change pact hammered out in Paris last December, heralding the country's return to global carbon markets four years after abandoning them.
Climate Change Minister Paula Bennett announced the ratification this morning ahead of attending next month's annual global climate change summit, to be held in Marrakech, Morocco.
New Zealand effectively walked away from global markets in 2012 when the country decided against adopting carbon emissions reductions targets through to 2020 using the rules adopted under the Kyoto Protocol, the now-defunct agreement that governed emissions reductions by a limited number of developed economies up until 2012.
That prevented major emitters from accessing very low-cost, low-quality international carbon credits that flooded out of the former Soviet bloc and saw carbon prices under New Zealand's emissions trading scheme fall to 50 cents a tonne and lower at times. Since agreeing to the new Paris pact and announcing an end to subsidies for major emitters, NZ Units in the ETS have risen to about $18.80 a tonne.
New Zealand attracted international criticism for failing to adopt new Kyoto-based targets, preferring instead to push for a new global pact, the bones of which emerged at Paris last year and commit the country to cutting its carbon emissions by 30 percent from 2005 levels by 2030.
However, the detailed rules of the new pact have yet to be negotiated.
New Zealand had not initially intended to ratify the Paris agreement so quickly, but momentum among major signatories including the United States and China forced the government's hand, since failure to ratify early could have locked the country out of the rule-making negotiations.
Rules on the treatment of a range of important carbon offsets, such as the use of plantation forests as carbon 'sinks', are vital to New Zealand's efforts to meet its 2030 commitments.
"A significant benefit of the government ratifying early is that it guarantees New Zealand a seat at the decision-making table on matters that affect the Paris agreement at the next United Nations climate change meeting in Marrakech in November," said Bennett.