Consultation on New Zealand’s ETS openedForestry Minister Shane Jones and Minister for Climate Change James Shaw have opened consultation on improvements to the Emissions Trading Scheme (ETS); New Zealand’s main tool for reducing greenhouse gas emissions.
The ETS encourages businesses to reduce their emissions by putting a price on them. The fewer emissions they create, the fewer ETS units they have to pay for. “The ETS has a vital role to play in New Zealand meeting its climate change targets, but the way it currently operates means it’s not doing that,” Shane Jones said.
“Getting the ETS right could drive the planting of 340 million trees over the next 10 years – double the amount that would be planted if the ETS was left in its current state. This is one of the most important levers the Government has to incentivise the planting of trees to help reach our Billion Tree programme’s goals”.
“A net zero emissions target by 2050 is currently being considered in the Zero Carbon Bill process but, in the meantime, we need to make sure the ETS is improved so that it is a credible and well-functioning scheme to help us meet our emissions targets,” James Shaw said.
“Businesses have told us that they haven’t had clear and consistent information on which they can assess the value of an NZ ETS unit and, therefore, how it could affect their bottom line. So, one of the proposed improvements is a consistent, transparent way of making decisions about the supply of ETS units.
“A single dedicated website with all the Government’s information about the NZ ETS is proposed so that businesses have the information they need. Another proposed improvement is businesses being able to see how many ETS units will be supplied over the next five years.
“What we’re talking about is putting a cap on the number of ETS units, and managing that cap over time. As part of the consultation, the Government is interested in hearing stakeholders’ opinions about exploring the possibility of a change to the $25 fixed price option”.
Shane Jones said improvements to the ETS would remove barriers to forestry owners participating in the scheme and make things like complex accounting requirements simpler for calculating carbon stored in forests. Growth in the forestry sector is potentially one of New Zealand’s largest and most effective options for off-setting emissions. The ETS needs to encourage new forests and discourage deforestation”.
“We’re putting forward a number of improvements to help foresters make informed and confident decisions about how to maximise the carbon stored in their forests over the long term,” Shane Jones said. Consultation runs from now until 21 September, with stakeholder meetings at a number of locations around the country.
Submissions and more information can be made via the ETS consultation website: www.mfe.govt.nz/consultation/ets.
The discussion document for improvements to the ETS framework can be viewed here.
The discussion document for the forestry improvements to the ETS is here.
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