"Its bias towards the interests of polluters is a fundamental
flaw, meaning windfall profits to their shareholders and big costs
to the taxpayer and the climate," says Greenpeace climate
campaigner Susannah Bailey.
"To be on track to avoid dangerous levels of climate change, the
Government needs to achieve at least a 30% reduction in New
Zealand's greenhouse gas emissions by 2020 and an 80-90% reduction
by 2050 from 1990 levels. This scheme won't get us close.
Projected emissions reductions from the scheme fall far short of
those required under the Kyoto Protocol."
"To be effective and fair, all sectors and greenhouse gases
should be included, industries should not be subsidised with free
permits to emit greenhouse gases, and revenue generated from the
scheme should be invested in sustainability projects."
Yet today, the Government announced that the agricultural sector
will be exempt until 2013, and even then will receive the vast
majority of its permits for free.
"Every New Zealander will be paying for agriculture's share of
the burden. The Government's decision to exempt agriculture means
that the dairy sector will be subsidised at a time when they least
need it. Mandatory targets for all sectors are essential in order
for significant reductions to be achieved," said Ms Bailey.
Big energy users will also benefit from free subsidies in the
scheme, with the cost picked by the New Zealand taxpayer. Free
credits will weaken the credibility and effectiveness of the
scheme. "Free credits are the emissions trading equivalent of tax
breaks. Every free credit that goes to industry is money in
shareholders pockets while consumers not only subsidise the
polluting sector through their taxes but also pay increased prices
. It is disappointing that the Government hasn't learned from
the European Union, who found that free credits offered through
phase one of their emissions trading scheme did not provide
sufficient encouragement for firms to reduce their emissions."
The Government should auction permits and use the money raised
to assist vulnerable people and help New Zealanders to live more
"The establishment of an emissions trading scheme is a step in
the right direction, but the current scheme fails to go anywhere
near far enough. As the scheme stands, the agricultural sector and
big energy users are the winners and taxpayers and the climate
carry the burden. The Government has picked up the ball on
emissions trading, but doesn't seem to have the courage to run with
The main problems with the current proposal for emissions
- There are no mandatory emissions reduction targets. There is
therefore no guarantee that New Zealand's emissions will actually
reduce as a result of this scheme. Goals for carbon neutrality do
not guarantee emissions reductions
- Not all sectors are included in the scheme from the outset
Agriculture will be subsidised by New Zealand taxpayers for the
next six years.
- Major polluters can expect windfall profits under the scheme
from free pollution credits
- Coal exports are exempt as are fugitive emissions from coal
mining (although fugitive geothermal emissions are covered by the
(1) The overwhelming majority of scientists agree that global
emissions of at least 50% by 2050 are needed to avoid dangerous
levels of climate change. Wealthy developed countries such as New
Zealand who are collectively the main cause of the current levels
of greenhouse pollution need to reduce their emissions by at least
80 per cent by 2050.
(2) This has been the experience in the European Union's
emissions trading scheme. The price of goods and services rise to
reflect the price on greenhouse gas emissions, and the difference
provided by free credits generates windfall profits for
Other contacts: Susannah Bailey, Climate Campaigner – 021 905 582
Michelle Thomas, Communications Officer, 021 577 556
Exp. contact date: 2007-10-20 00:00:00