NZ ETS changes announced

Friday 17 May 2019

 
The second set of improvements to the New Zealand Emissions Trading Scheme (NZ ETS) have been announced to further encourage greenhouse gas emissions reductions and increase forestry planting, said the Minister for Climate Change.

These latest changes will:

- improve transparency within the NZ ETS,
- increase rates of compliance with the scheme,
- pave the way for robust NZ ETS auctions,
- ensure that the fixed price option is removed no later than the end of 2022,
- enable a price floor to be added to the NZ ETS if necessary, in future.

From 2021, changes designed to increase transparency of the NZ ETS will let the public access more information about the scheme, including the emissions of individual NZ ETS participants.

“It’s critical for public trust in the NZ ETS that information is readily available,” James Shaw said. “It’s also crucial that participants comply with their obligations”.

NZ ETS compliance rates are expected to increase as a result of planned changes to the existing penalty regime which will see penalties separated into two categories; one related to reporting compliance and the other related to surrender/repayment obligations.

NZ ETS auctions, which are planned to begin in late 2020, will also be strengthened by these changes. “We have enabled the appointment of an auction monitor to independently oversee NZ ETS auctions. An auction monitor will minimise anti-competitive behaviour and promote fair access to auctions,” said Mr Shaw.

Under the latest changes the current $25 fixed price option price ceiling (FPO) will be removed when auctioning begins, or no later than 31 December 2022. “This ensures that the FPO will be removed while also allowing for any unexpected events, such as a delay to the introduction of auctioning,” Mr Shaw said.

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