Carbon market close to collapseFriday 22 Feb 2013 New Zealand’s carbon market has almost collapsed according to Carbon News 2013. Prices for spot NZUs set a new low late last week, breaking the NZ$2 floor for the first time. Some international units were trading as low as 15 cents.Sentiments expressed by Carbon Match founder Lizzie Chambers in her weekly newsletter - she describes the New Zealand Emissions Trading Scheme as “suffering a lack of credibility in the eyes of landowners” and predicts a price race to the bottom – are echoed privately by others in the market. The planting of forest is a critical part of the Government’s plan to reduce New Zealand’s overall greenhouse gas emissions. The ETS is supposed to encourage this, by providing foresters with an extra income stream. But rock-bottom prices (from more than NZ$20 for a spot NZU in early 2011) has seen major forest owners back away from it. Others have implored Prime Minister John Key to intervene to stop the flow of cheap carbon into the country. Last month, Carbon News reported that foresters are now leaving the scheme. The Government has instructed officials to find other ways of encouraging afforestation, such as a return to the Afforestation Grants Scheme. Source: Carbon News 2013 |
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