The New Zealand Emissions Trading Scheme (NZ ETS) is an all-gases partial-coverage uncapped domestic emissions trading scheme that features price floors, forestry offsetting, free allocation and auctioning of emissions units.
The NZ ETS was until 2015 highly linked to international carbon markets as it allowed unlimited importing of most of the Kyoto Protocol emission units. There is a domestic emission unit; the 'New Zealand Unit' (NZU), which was initially issued by free allocation to emitters until auctions of units commenced in 2020.[5] The NZU is equivalent to 1 tonne of carbon dioxide. Free allocation of units varies between sectors. The commercial fishery sector (who are not participants) received a one-off free allocation of units on a historic basis.[6] Owners of pre-1990 forests received a fixed free allocation of units.[7] Free allocation to emissions-intensive industry,[8][9] is provided on an output-intensity basis. For this sector, there is no set limit on the number of units that may be allocated.[10][11] The number of units allocated to eligible emitters is based on the average emissions per unit of output within a defined 'activity'.[12] Bertram and Terry (2010, p 16) state that as the NZ ETS does not 'cap' emissions, the NZ ETS is not a cap and trade scheme as understood in the economics literature.[13]
The NZ ETS has been reviewed and amended many times: first in November 2009[3] then in late 2011 to 2012 by an independent panel.[16][4] A 2016 Government review concluded that the NZ ETS had caused only minimal reductions in net emissions. [17] In 2020 rules for emissions budgets and auctions of units within price caps were introduced.[18]
In June 2009, Nick Smith released an economic modelling report on the NZ ETS by economic consultants NZIER and Infometrics which had been prepared for the Emissions Trading Scheme Review Committee. Smith stated that the report supported the Government's intention to modify the NZ ETS.[19] The report "Economic modelling of New Zealand climate change policy"[20] created static computable general equilibrium (CGE) models using 2008 emissions projections. The terms of reference set the policy options to look at as the 2008 NZETS vs the least-cost option for meeting the Kyoto liability vs a revenue-neutral tax on carbon equivalents.
The impacts of the various options were estimated as the differences between a carbon tax and a reference 'business as usual' scenario assuming New Zealand had not signed the Kyoto Protocol. The variables changed in the model runs were the NZ carbon price ($0, $10, $25 or $100), the world carbon price, the duration (short term to 2012, long term to 2025), the level of free allocation and whether the Government assumed all Kyoto liabilities. The results of each model run was reported as the percent difference from the 'no-Kyoto' 'business as usual' scenario in 2012 or 2025.[21]
The report noted several limitations of computable general equilibrium models that should be kept in mind in interpreting the results: CGE models are only an approximation of highly complex real economies, results can only ever be indicative,[22] and are highly dependent on the structure of the models and the input assumptions and on the assumption that other variables remain constant. Therefore, the "interpretation of CGE results should centre on their direction (up or down) and broad magnitude (small, medium or large), rather than on the precise point estimates that the model produces".[22]
The report's bolded conclusion was that a narrow carbon tax or trading scheme was the least cost option in the short term.[23] Predicted reductions in GHG emissions ranged from 0% (Government pays), 0.4% to 2.8% for a $25 carbon price and 3% to 4% for a $50 price.[24] However, the report noted that there was little difference in costs between the government paying all and the ETS with free allocation, as all the model results indicated small reductions (-0.1% and -0.4%) in Gross National Disposable Income compared to 'business as usual'.[25] In respect of the 2009 amendments to the NZ ETS, intensity-based allocation was favoured over allocations based on historical emissions by business groups, and representatives of large emitters,[26] by Fonterra[27] and by Federated Farmers.[28] Environmental organisations and opposition political parties opposed intensity based allocations.[14][15][29]
First version of the emissions trading scheme, 2008
The proposed scheme covered all six greenhouse gases specified in the Kyoto Protocol and was intended to progressively apply to all sectors of the economy including agriculture. 'Participants' (who would account for their emissions) were to be few, and high in the production chain of each sector. Their compliance obligation would have been to surrender one New Zealand unit (NZU) or one internationally tradable Kyoto-compliant unit for each tonne of emissions.
New Zealand units were to be capped in number and were to be allocated to participants either by grandparenting (gifting) or auctioning. Sectors of the economy were to have progressively entered the NZ ETS, with forestry the first from January 2008 and agriculture last in January 2013. Allocation rules varied between sectors. In general, participants who could pass on costs of the ETS, such as fuel companies, would not be allocated free units. Participants such as exporters with products that are priced internationally, would be allocated free units.[31][32]
Forest owners with pre-1990 forests were to receive a fixed one-off free allocation of units. Transport (liquid fossil fuels), stationary energy and industrial processes would not receive a free allocation of units. Trade-exposed industries would have received a free allocation of 90% of 2005 emissions annually to 2018. From 2019 to 2029 the free allocation of units would have phased out at the rate of a 1/12 (8.3%) reduction each year. Agriculture would have received a free allocation of 90% of 2005 emissions each year to 2018. From 2019 to 2029 the free allocation would have phased out at the rate of a 1/12 (8.3%) reduction each year. Fishing would have received a free allocation based on 50% of 2005 emissions each year from July 2010 to January 2013.[33]
In early September 2009, Rod Oram predicted that the National Government's goals would be; to adopt intensity-based allocation of free carbon credits to export industries; have no cap on greenhouse gas emissions; to have a temporary cap on the price of carbon; to delay bringing in sectors into the NZETS; to delay phasing out free emission units; and, maximum alignment with the Australian Carbon Pollution Reduction Scheme. Oram viewed these changes as significantly weakening the incentives to reduce emissions and to plant carbon forests.[34]
On 14 September 2009, the National Government Minister for Climate Change Issues Nick Smith announced that it had reached an agreement with the Māori Party about revisions to the NZ ETS and that an amending bill would be drafted in order to "make the ETS workable and affordable".[35]
On 24 September 2009, the Climate Change Response (Moderated Emissions Trading) Amendment Bill had its first reading in Parliament and was sent to the Finance and Expenditure Select Committee for public submissions.[36]
Submissions to the Finance and Expenditure Committee
Between 15 October 2009[37] and the date of its final report, 16 November 2009, the Finance and Expenditure Committee received 399 submissions on National's draft bill.[38]
Absence of a cap on emissions
In 2007, the Ministry for the Environment released a detailed report, "The Framework for a New Zealand Emissions Trading Scheme", which stated the NZ ETS would not have a binding, absolute limit on the total level of emissions allowed in New Zealand. While the quantity of domestic NZ Units gifted to eligible emitters would be fixed, the quantity of international 'Kyoto-compliant' units that could be imported in to match emissions would not be limited.[39] In consequence, as there is no limit on the volume of international emissions units (CERs and ERUs) that may be imported, there is no cap or limit on the volume of emissions permitted in New Zealand provided that emissions units are imported into the country and surrendered. In that respect, the NZ ETS is unlike most other emissions trading schemes,[40]
Ministry for the Environment Fact Sheet 16 stated "There is no cap on the emissions that occur within New Zealand." However, the Ministry for the Environment still regarded the NZ ETS as operating within the cap on emissions established by the Kyoto Protocol for the first commitment period of 2008–2012.[33] Moyes (2008) describes this as a "flexible cap" where New Zealand sourced emissions regulated by the NZETS are constrained only by the international market price for GHG emissions.[40]
Nick Smith's press release of September 2009 announced that the method of allocation of NZ units to trade exposed and emissions intensive firms would now be based on average industry production, where the levels of units allocated would vary in proportion to a firm's production.[35][41]
In combination with the unlimited use of internationally sourced Kyoto units, the allocation of New Zealand units to eligible emitters in proportion to their production means that there is no cap on total emissions within New Zealand.[11]
There is also no cap on total emissions during the transition period as the Government will supply the market with unlimited New Zealand units at the fixed price of NZ$25 per NZU.
When the NZETS included a proposed free allocation of units to agriculture, there were no eligibility tests. Allocations to agricultural activities were to have been made on an intensity basis. The baseline would have been the sector average emissions per unit of output.
Allocation of NZ Units to trade-exposed activities
Under the 2009 NZ ETS, all NZ emission units were only distributed into the market by free allocation (gifting). In 2010, the Ministry for the Environment stated that there was no intention in the short term to auction any emission units.[42] 'Emissions-intensive' and 'trade-exposed' (EITE) activities are designated a benchmark level of emissions per unit of production. For example, x amount of carbon dioxide equivalent emissions per tonne of steel. Firms then receive an allocations based on their expected production of the emissions intensive good.
This method of allocation is often referred to as 'intensity based allocation'. Intensity based allocations are allocations that are based on the volume of production of a firm.[43] Allocations are given at the beginning of the period and then balanced at the conclusion to reflect actual output.
The benchmark (or allocative baseline) for free allocation for firms considered emissions-intensive and trade-exposed includes compensation for electricity price increases.[44]
Fiscal impact of allocation
From the 2008 election, the policy of the National Party[45] was that the NZ ETS should be fiscally neutral, in the sense of a Government policy where any new taxes or revenues equal any new spending[46] The policy of a fiscally neutral NZ ETS was confirmed by John Key[47]Bill English,[48] and Nick Smith in his speech on the third reading of the Climate Change Response (Moderated Emissions Trading) Amendment Act 2009.[49]
The cost of free allocation of units to emitters is a highly contentious subject. The Sustainability Council argued that the allocation of units to industry is highly costly to taxpayers.[50]
Dr Christina Hood, a climate change and energy policy consultant, submitted to the Finance and Expenditure Select Committee that the use of uncapped intensity based allocation of units will result in a taxpayer subsidy to emitters of about NZ$105 billion up to 2050.[51]
Economist Geoff Bertram estimated that at a carbon price of NZ$50 a tonne, the cost to taxpayers of the free allocation of NZ units to emitters will be NZ$99 billion between 2010 and 2091.[52]
Nick Smith's Cabinet Paper noted that the New Zealand Treasury had estimated that the long-term costs of intensity-based allocation of units to industry and agriculture would be 'very significant', in the order of NZ$900 million per annum by 2030.[53]
The Clerk of the House invited economist Suzi Kerr to give independent specialist advice on the Climate Change Response (Moderated Emissions Trading) Amendment Bill. Kerr's advice was that the free allocation of emission units significantly raised the overall cost of the NZ ETS to the economy and transferred it to taxpayers.[54]
Decrease in allocation of units
The 2009 legislation did not include a specific sunset clause to change the allocation of units to firms that undertake emissions-intensive and trade-exposed activities. The legislation stipulates that allocations must be reviewed no less than once every five years by a review panel. In late 2009, Climate Change Minister Nick Smith stated that estimates of fiscal impacts beyond 2020 at the present time are meaningless as there are simply too many unknowns.[55]
Although the level of allocation per unit of output for emissions-intensive and trade-exposed industrial activities decreases at 1.3% per year from 2013, as production may increase, allocations may also increase over time.[56]
Transitional assistance
The NZ ETS contains special transitional provisions from 1 July 2010 (when fossil emissions enter the scheme) until 31 December 2012 (transition period). This end date coincides with the end date of the Kyoto Protocol. Although transitional measures are legislated to end after 2012, the Government has suggested that they will be extended in the event that major trading partners such as the US and Australia do not implement emissions trading schemes of their own before then.[57]
During the transition period participants in energy, fossil fuels and industry will only need to surrender one NZU for two tonnes of carbon dioxide equivalent emissions. Free allocation of units to energy-intensive and trade-exposed activities will also be halved. Secondly, participants may pay a fixed price of NZ$25 instead of buying and surrendering units. This measure means that firms will face a cost of no higher than NZ$12.50 per tonne of emissions. There is a restriction on the sale of units oversea during this transition period, except for forest removal credits.[6]
Delayed entry for agricultural emissions
Agricultural emissions, methane from enteric fermentation and manure management as well as nitrous oxide from animal effluent and fertiliser, were to enter the scheme on 1 January 2015. A 'Questions and Answers' fact sheet released by Nick Smith (Minister for Climate Change Issues) stated that the delayed entry was due to the difficulties in measuring and monitoring agricultural emissions and the limited technologies available for reducing emissions in the sector.[58]
The economic modelling conducted by NZIER and Infometrics stated:
If the aim of climate change mitigation policies is to change producers' behaviour, it is vital to be able to measure emissions in a cost effective manner. If the transaction costs of measuring emissions outweigh the benefits of emissions reduction, the policy may not be net welfare enhancing. Therefore the transaction costs of implementing an all-sectors all-gases ETS need to be evaluated. It may be advisable to exempt sectors such as agriculture where measurement costs are high relative to the benefit that would be gained from that sector’s inclusion. Our modelling suggests that, in the short term, such exemptions do not reduce economy wide welfare.
The Parliamentary Commissioner for the Environment considered that there was insufficient evidence to justify leaving agriculture out of the NZ ETS until 2015.[56] A submission from the Institute of Policy Studies (New Zealand) and The New Zealand Climate Change Research Institute considered that the delayed entry of agriculture into the NZ ETS would reduce long term competitiveness of the New Zealand economy by supporting industry that can not compete in an emissions constrained world.[59]
The Climate Change Response (Moderated Emissions Trading) Amendment Act 2009
Adoption
On 25 November 2009, the bill had its second and third readings[3] and it was adopted by 63 votes to 58, with the support of the National Party (58 votes), the Maori Party (4 votes) and United Future (1 vote).[60] The Labour Party (43 votes), the Greens (9 votes), ACT (5 votes) and the Progressive Party (1 vote) voted against the third reading.[38]
On 7 December 2009, the Climate Change Response (Moderated Emissions Trading) Amendment Act 2009 received the royal assent.[36]
Coverage and scope
The NZ ETS covers forestry (a net sink), energy (42% of total 2012 emissions), industry (7% of total 2012 emissions) and waste (5% of total 2012 emissions) but not pastoral agriculture (46% of 2012 total emissions).[61] Participants in the NZ ETS must surrender one emission unit (either an international 'Kyoto' unit or a New Zealand-issued unit) for every two tonnes of carbon dioxide equivalent emissions reported or they may choose to buy NZ units from the government at a fixed price of NZ$25.[10] The one-for-two surrender obligation was phased out evenly over three years from 1 January 2017. The "one for two" or 50 percent surrender obligation increased to 67 percent from 1 January 2017, then to 83 percent from 1 January 2018, and to 1 unit for one tonne of emissions surrender obligation from 1 January 2019 for all sectors in the NZ ETS.[62]
Sector entry dates
Individual sectors of the economy have different entry dates when their obligations to report emissions and surrender emission units took effect. Forestry, which contributed net removals of 17.5Mts of CO2e in 2010 (19% of NZ's 2008 emissions[63]) entered the NZ ETS on 1 January 2008.[7] The stationary energy, industrial processes and liquid fossil fuel sectors entered the NZ ETS on 1 July 2010. The waste sector (landfill operators) entered on 1 January 2013.[64] From November 2009, methane and nitrous oxide emissions from pastoral agriculture were scheduled to be included in the NZ ETS from 1 January 2015.[6] Agriculture was indefinitely excluded from the NZ ETS in 2013.[65]
Technical Details
The Climate Change Response (Moderated Emissions Trading) Amendment Act 2009 established an emissions trading scheme with obligations on emissions from all sectors and all gases.[3][58] From 2015, the technical details can be summarised as:
All emissions from all sources will have obligations. This includes emissions from biological sources such as methane from enteric fermentation and nitrous oxide from animal effluent.
Allocations will be made to firms who undertake activities that are deemed to be both 'trade-exposed' and 'emissions-intensive'. Moderately emissions intensive activities will receive allocations equal to 60% of the industry average for the financial years ending 2007, 2008 and 2009. Highly emissions intensive industries will receive allocations equal to 90% of the industry average for this period. Allocation per unit of output will decrease by 1.3% per year from 2013 (on an exponential basis rather than a summation basis).
As allocations are based on production levels, allocations are not 'capped' at any specific level.
Moderately emissions intensive activities are those that produce more than 800 tonnes of carbon dioxide equivalent emissions per million dollars of revenue. Highly emissions intensive activities are those that produce more than 1600 tonnes per million dollars of revenue.
Electricity generators will not receive allocations, however a firm may receive allocation for electricity use if it conducts an 'emissions intensive' and 'trade exposed' activity (EITE).
Liquid fossil fuel is excluded from allocation in all instances.
Owners of forests planted after 31 December 1989 are able to opt into the scheme and receive units for forest sequestration. If these forests are removed from the land the owner must repay these units.
Owners of land that was in forest on 1 January 1990 and remained in forest on 1 January 2008 must surrender emissions units if they wish to deforest land AND change the land use to a use other than forestry.
Agricultural activities will automatically receive a 90% allocation per unit of production, phased out at a rate of 1.3% per year from 2016.
Sector entry dates obligations and allocations
The proposed sector entry dates, obligations and unit allocation terms of National's proposed NZ ETS are set out in the table below.[6][10]
Sector
Entry date
Transitional obligation until December 2012 (CP1)
Unit allocation terms
pre-1990 forest
1 January 2008
Fixed surrender price NZ$25/tonne
Allocation of 60 free units per hectare to pre-1990 forests (which may be sold internationally), otherwise units to be purchased for deforestation
post-1989 forest
1 January 2008
Fixed surrender price NZ$25/tonne
Afforestation (carbon removal) earns units, otherwise units to be purchased for deforestation
Transport (Liquid fossil fuels)
1 July 2010
One emission unit for two tonnes emissions (50%) and fixed surrender price NZ$25/tonne
Units to be purchased
Stationary energy
1 July 2010
One unit for two tonnes (50%) and fixed surrender price NZ$25/tonne
Units to be purchased
Emission-intensive industrial processes that are not trade-exposed
1 July 2010
One unit for two tonnes (50%) and fixed surrender price NZ$25/tonne
One unit for two tonnes (50%) and fixed surrender price NZ$25/tonne
Free allocation on intensity/production basis phasing out from 2013 at 1.3% each year (In 2012, the planned annual phase out was indefinitely deferred).
Agricultural Gases (methane and nitrous oxide from biological processes)
1 January 2015
No obligation in CP1 except reporting from 1 January 2012.
Free allocation on intensity/production basis phasing out from 2016 at 1.3% each year (In 2012, the planned obligations were indefinitely deferred).
Fishing
1 July 2010
Not participants. No requirement to report emissions or surrender NZUs
700,000 NZUs (90% of 2005 emissions) allocated free to fishing quota holders until 1 January 2012.
Units able to be traded
The NZ ETS created a specific domestic emission unit for use in New Zealand, the New Zealand Unit (NZU). The NZUs are not a Kyoto unit in terms of compliance with the Kyoto Protocol, and can only be surrendered or traded within New Zealand. Assigned amount units (AAUs) issued by New Zealand under the Kyoto Protocol can be also used by emitters to meet their surrender obligations, but assigned amount units issued by other Annex B countries may not be used.[66]
Participants in the NZ ETS are also able to purchase and surrender international Kyoto units such as Emission Reduction Units (ERUs), Certified Emission Reductions (CERs) and Removal Units (RMUs) issued in other countries. Unlike most other emissions trading schemes the NZ ETS has no limit on the volume of international units (CERs and ERUs) that may be imported.[40] Consequently, the NZ ETS is highly linked to the international market for greenhouse gas emission units. This degree of linkage and the lack of a national cap on emissions makes New Zealand a price-taker where control of the price of emissions to firms is relinquished to the international markets.[40]
During the transition phase (July 2010 to December 2012), only the forestry sector will be able to convert the NZUs allocated to them to assigned amount units that can be sold to overseas buyers.[5][67] However, temporary CERs and iCERS cannot be used in the NZ ETS, and neither can CERs and ERUs generated from nuclear projects.[68]
From 23 December 2011, Certified Emission Reduction (CERs) units from HFC-23 and Nitrous oxide (N2O) industrial gas destruction projects were banned from use in the NZ ETS, unless they had been purchased under future delivery contracts entered into prior to 23 December 2011. The use of CERs from the future delivery contracts ended in June 2013.[69]
Reaction to the Climate Change Response (Moderated Emissions Trading) Act 2009
Business and farming
According to Brian Fallow, the New Zealand Herald Economics editor, business lobby groups such as Business New Zealand and the Greenhouse Policy Coalition (representing the energy intensive sector) welcomed the introduction of a temporary price cap and the principle of basing free allocations of units on the basis of intensity of production.[26]
In September 2009, the Greenhouse Policy Coalition described the proposed changes to the NZ ETS as "a welcome move in the right direction". The Coalition stated that it approved of the half-cost unit surrender obligation in the first commitment period, the $12.50 price cap on carbon, and the slower phase-out of assistance to industry.[70]
Business New Zealand welcomed National's revisions to the NZ ETS of 14 September 2009 as better balancing environmental and economic needs, and stated that it was pleased that the Government had accepted the intensity basis for allocation of units.[71]
The Business Council for Sustainable Development stated that New Zealand was risking "being left behind" in proposing an all-sectors, all-gases ETS that in 2015 would have almost no impact on heavy emitting industries facing international competition.[72]
Federated Farmers commented that "there is no place for agricultural emissions in the ETS", that "the Government must seek to remove agriculture at Copenhagen in December",[73] and that the NZ ETS is "the road to economic hell being paved with good intentions".[27]
Editorial opinion
The New Zealand Herald described the Climate Change Response (Moderated Emissions Trading) Bill as "backward legislation" and a "miserable offering to the international effort".[74]
The Dominion Post commented that the NZ ETS is a failure because "those responsible for the emissions don't have to foot the bill".[75]
The New Zealand Listener stated: "Our poorly thought-out emissions trading scheme does nothing to enhance our reputation" and predicted that the lack of bi-partisan support for the NZ ETS would lead to further uncertainty in New Zealand's climate-change policy.[76]
International media
In November 2009, the Sydney Morning Herald reported that the revised NZETS had been "significantly watered down" and that it gave "big polluters a much easier ride".[77]
Reuters reported that the amended NZ ETS allowed unlimited imports of offsets and that business groups largely backed the changes, while environmental groups largely felt that the NZ ETS would not do enough to reduce emissions.[78] In March 2010, Reuters reported that the NZ ETS had "no emissions cap nor any limit on the number of free carbon permits for energy-intensive companies that export their products". Reuters noted that the absence of a cap and the two-tonnes-for-one-unit surrender arrangement had led to "accusations of some big polluters getting a free ride and that the scheme will fail to cut emissions of planet-warming gases".[79]
In March 2010, The Economist commented on the delayed entry of agriculture into the scheme and noted the environmental concerns over the "generous allocations of free carbon credits to business".[80]
Commentators
Rod Oram commented in a Sunday Star Times column that the National Government's changes to the ETS were "a giant step backwards" which would "drive up emissions, perpetuate old technology, necessitate ever-greater subsidies and reduce New Zealand's international competitiveness and reputation." Oram considered that the amendments to the NZ ETS destroyed its effectiveness. His examples were: removing limits on emissions by adopting intensity-based allocation of free carbon credits, slavishly following climate-laggard Australia, minimising the price incentive by extending the free allocation of credits for 75 years, muting the price signal with a NZ$25 per tonne of carbon cap, forcing forestry holders of credits to sell them overseas because of the NZ$25 per tonne cap, cancelling complementary measures such as fuel efficiency standards, giving in to special pleading via subsidies, and creating uncertainty for business.[81]
Colin James described the National ETS as "...the ETS you have when you are not having an ETS – no cap on emissions (so no "cap" in the "cap-and-trade"), a cap on price (so no "trade", just tickle the taxpayer) and languorous phase-downs of gross emissions which push out hard decisions (if needed) into a misty future."[82]
The New Zealand Herald's economics editor Brian Fallow said: "Clearly emissions will peak higher and later than they would have done under the existing scheme. But the higher and later the peak in emissions, the steeper and more economically costly the subsequent decline will have to be".[83]
Political parties
The Labour Party noted that the allocation of credits to emitters on a 'intensity' basis, with no cap on emissions, meant that emitters would have an incentive to continue to emit greenhouse gases. Taxpayers would have to fund the long period of assistance by allocation of free units to industry at a cost of up to NZ$2 billion by 2030.[84]
Labour Party climate change spokesman Charles Chauvel said that the National NZ ETS "is fundamentally flawed on multiple levels. It is economically irrational, socially inequitable, environmentally counter-productive and fiscally unsustainable".[85] Chauvel also questioned the fairness of households receiving assistance in the form of the half obligation only until 2013, when large foreign-owned companies such as Methanex, Rio Tinto Alcan NZ Ltd and New Zealand Steel would receive taxpayer support for an extra 90 years.[86]
Jeanette Fitzsimons of the Green Party said: "This is the sort of emissions trading scheme you have when you still think climate change is a hoax"[87] and she commented that the NZ ETS would not reduce emissions and would be "the biggest wealth transfer in New Zealand history from the taxpayer to the big polluters".[88]
John Boscawen of the Act Party commented that the NZ ETS was a grand experiment, without precedent in any other nation in the world. Boscawen was critical of the effect that the ETS will have on households and farmers, stating that the average power bill will rise 10%, fuel bills will rise by 7 cents per litre and dairy farms will face an increase in costs before agriculture enters the scheme of NZ$7,500 per year as a result of associated increases in fuel, electricity and the cost of processing milk products. Boscawen called for the NZ ETS to be scrapped or delayed indefinitely.[89]
Environmental organisations
Greenpeace Aotearoa New Zealand noted that the intensity-based allocation of NZ Units to industry and the slow phase-out of free units would allow emissions to grow and described the NZ ETS as "pathetic".[15] Greenpeace's Simon Boxer described the NZETS to TV3 as "the worst emissions trading scheme in the world".[90]
Gary Taylor, of the Environmental Defence Society, said that "An emissions-trading scheme welcomed by polluters and coal producers is not going to work" and "New Zealand is now a climate change laggard".[91]
ECO (Environment and Conservation Organisations of Aotearoa New Zealand) described the NZ ETS as a "major disappointment" and said that "The changes allow 65 large companies long periods of subsidisation by taxpayers, particularly households, right out to 2050, with farmers and the fishing industry getting especially large subsidies."[92]
World Wide Fund for Nature (WWF) New Zealand described the New Zealand Emissions Trading Scheme as "a complete shambles" because it sets no limit on total pollution, it allows emissions to grow and it transfers the cost of emissions from polluters to taxpayers.[93]
Carbon Trade Watch have described it "as a taxpayer subsidy for plantations and energy companies".[94]
Parliamentary Commissioner for the Environment
In October 2009, New Zealand's independent environmental watchdog, Jan Wright, the Parliamentary Commissioner for the Environment, made a submission to the Select Committee considering National's amendments to the NZ ETS. The submission stated that the allocation of free units to industry was too generous and the length of the phase-out of free allocation was too slow. Without a carbon price signal to invest in low carbon technologies, emissions would continue to rise.[14]
In November 2009, Wright was sufficiently concerned that the Climate Change Response (Moderated Emissions Trading) Amendment bill would result in increased emissions that she publicly urged politicians three times not to adopt the National Government's legislation. She opposed the removal of a firm cap on emissions, the reduction of price incentives to reduce emissions, and the heavy subsidies from taxpayers granted to emissions-intensive industry and agriculture by the intensity-based allocation of free units.[95][96][97]
When the Climate Change Response (Moderated Emissions Trading) Act was adopted, Wright said in a radio interview "It's virtually certain our emissions will grow and the burden on the taxpayer will be uncurbed".[98]
As the energy and liquid fossil fuels were about to enter the NZ ETS in July 2010, Wright expressed her concern that although the NZ ETS was the right framework, the subsidies to big emitters would limit the incentives to reduce emissions and impose significant costs on the taxpayer.[99]
2012 review of the New Zealand ETS and amendments
The Climate Change Response Act 2002 requires a review of the NZ ETS by an independent review panel every five years, with the first review to be completed in 2011. An Issues Statement and Call for Written Submissions document was released in March 2011, and the final report was released in September 2011. The review focused on the high-level design of the NZ ETS, particularly in the context of international efforts to tackle climate change post-2012.[16]
The report's major recommendations included:
phasing out the transitional two-for-one unit half-price surrender arrangement for a further three years to 2014, so that only from 2015 would emitters have to surrender one emissions unit for each tonne of emissions
a $5 per year increase in the price cap from 2013 (instead of no price cap)
that the agricultural sector should still enter in 2015, but should treated the same as other export industries
changes to the domestic ETS forestry accounting rules[100]
An editorial in the NZ Herald said that there was no merit in the Government's view that lack of mitigation options meant that agriculture should be kept out of the NZ ETS. The editorial described this as 'extraordinary generosity' to the agricultural sector.[101]
In April 2012, the Government released a consultation document in response to the review that stated that the Government intended to introduce amending legislation in July 2012, with the aim of passing it by the end of 2012.[102] The National Business Review considered that in spite of the "fairly cryptic" nature of the Government's response to the review of the emissions trading scheme, it was likely that pastoral farming emissions would not enter the NZ ETS until 2018.[103]
In November 2012, the Government passed the Climate Change Response (Emissions Trading and Other Matters) Amendment Act 2012.[4][104] The legislation extended the two-for-one unit surrender transitional measure indefinitely beyond 2012, indefinitely deferred the entry of agriculture, introduced an offsetting option for pre-1990 forests, created a statutory power to auction NZ units within an overall cap, and finally changed the treatment of the synthetic greenhouse gas sector.[65] The Government stated that the amendments were necessary to:
"maintain the costs that the ETS places on the economy at current levels. This will ensure businesses and households do not face additional costs during the continued economic recovery; and that New Zealand continues to do its fair share on climate change."
"make a number of important changes designed to improve the operation of the ETS, providing more flexibility for forest landowners and ensuring the scheme is 'fit for purpose' after 2012."[65]
2015 review of the NZETS
In November 2015, the government started consultation on a review of the NZETS.[105] Controversially, the question of whether to include agriculture in the scheme was omitted from the terms of reference of the review.[106]
Market performance and trading
Unit register
On 6 December 2007, the New Zealand Emission Unit Register (NZEUR) was established. The NZEUR has the role of issuing, holding, transferring and retiring emission units in terms of the Kyoto Protocol. The initial use of the NZEUR was to record Kyoto emission units allocated to firms enrolled in the Ministry for the Environment's Projects to Reduce Emissions and Negotiated Greenhouse Agreements programmes, and the Ministry of Agriculture and Forestry's Permanent Forest Sink Initiative.[107]
Market size
At 31 December 2008, the NZ Emissions Unit Register (NZEUR) had 128 official account holders. All were foresters except for four energy companies. 45 of the foresters reported removals (sequestration) of 692,583 tonnes of CO2-e and 692,583 NZUs were issued into the market.[108] In the year to 31 December 2009, 97 mandatory NZETS participants and 380 voluntary participants (largely post-1990 foresters) were added as NZEUR account holders. Foresters reported removals (sequestration) of 4,460,095 tonnes of CO2-e. Some foresters surrendered 4,526 NZUs for emissions from deforestation. 4,460,095 NZUs were issued into the market.[109] At 31 December 2010, there were 96 mandatory NZETS participants and 1,216 voluntary participants of which 1,195 were post-1990 foresters. Foresters reported removals (sequestration) of 9,445,606 tonnes of CO2-e. The quantity of emissions reported was 33,410,389 tonnes of CO2-e for the 2010 calendar year and 16,286,618 tonnes of CO2-e were reported for the NZETS compliance period from 1 July 2010 to 31 December 2010. Due to the two tonnes for one NZU arrangement, emitters surrendered 8,303,660 NZUs for their emissions. 12,776,026 NZUs were issued by free allocation into the market.[110] Forestry removals (sequestration) in the 2011 calendar year were 13,820,979 tonnes of CO2-e and the quantity of emissions reported was 31,803,198 tonnes of CO2-e. 11,596,460 NZUs were issued by free allocation into the market. Due to the two tonnes for one NZU arrangement, emitters surrendered 16,381,479 units for their emissions.[111] At 21 June 2012, there were 286 mandatory NZETS participants and 2,264 voluntary participants of which 2,254 were post-1990 foresters.[111]
Export of units overseas
In August 2009, forestry companies were selling units to domestic and international buyers. Forestry company Ernslaw One converted 520,000 NZ units into Assigned amount units and sold them to the Norwegian Government, in a deal brokered by New Zealand carbon broker, Carbon Market Solutions Ltd. At the time, it was the largest forestry carbon credit deal in the world. Industry sources estimated the prices were approximately NZ$21 to NZ$22 a tonne and that value of the trade would have been between NZ$10.9 million and NZ$11.4 million, depending on the exchange rate. Ernslaw One had also sold 50,000 units at NZ$20 (sales value about NZ$1 million worth) to a domestic buyer and then subsequently at the end of 2009 made a second 500,000 tonne trade with the Norwegian Government.[112]
Import of international units
As previously noted, the NZ ETS allows unlimited importing of international units which makes it a price-taker with only the international price as a constraint on emissions.[40] In the first compliance period the six months to December 2010, less than 2 per cent of the surrendered units were imported from the international Kyoto markets (64 per cent had been bought from forest owners and 31 per cent had been allocated free to trade-exposed industrial emitters).[113] In the 2011 calendar year, NZ emitters made a large switch from domestic NZUs to cheaper international units.[114] Of the 16.3 million units surrendered, 11.7 million units (or 72%) were imported international units (being 4.2 million CERs 4.3 million ERUs and 3.2 million RMUs.[115] In 2013, cheap international carbon credits made up 99.5 per cent of the units NZ emitters used to meet their obligations. Of these units, 91 percent were ERUs sourced from former Soviet Union countries that could not be used in the European Union ETS.[116]
Price movements
New Zealand petrol prices and the NZETS 'carbon price' from 2010 to date
Up to January 2011, market prices for NZ Units were largely set by the international price for Certified Emission Reduction (CER) units. In March 2011, European concerns over the implications of the Fukushima nuclear disaster for their nuclear reactors reduced atomic power generation and increased coal thermal generation. This caused extra demand for CERs in the European Union Emission Trading Scheme and CER prices exceeded NZ$25 a tonne, the effective price cap in the NZ ETS. NZ buyers switched from the more expensive CERS to cheaper NZUs which were traded at a record price of more than NZ$21 per tonne.[117] In July 2011, concerns over the Eurozone sovereign debt crisis combined with the high volumes of CERS being issued caused international CER prices to fall to a range between 9 and 10 euros. NZU prices fell to NZ$16.[118]
By August 2012, the very low European carbon prices had dragged the NZU price down to NZ$4.55 per tonne of carbon.[119] In mid September 2012, NZUs were selling for NZ$4.20 a tonne.[120] In late October 2012, New Zealand carbon prices dropped to about NZ$1 a tonne for some types of credits.[121] On 10 December 2012, the NZU spot price was $2.70 and it had declined by 72 percent over the 2012 year.[122] In February 2013, Westpac's carbon dealing desk noted that imported European carbon credits were trading for 28 NZ cents and the price for NZUs was NZ$2.50.[123] In January 2014 the price of one NZU was about NZ$3.50, up from NZ$2 a year earlier.[124]
Impacts on prices
Petrol
In September 2007, the 2008 NZETS was expected to increase the GST-inclusive retail price of petrol by 3.7 cents a litre (2.5%) under a $15 carbon price scenario and 6.1 cents (4%) under a $25 scenario.[125] The Labour Government predicted that the NZETS may cause petrol prices to rise by about 4 cents a litre.[126]
Between 1 July 2010 and February 2015, the estimated NZETS component of the retail petrol price has ranged from a maximum of 2.4 cents per litre from late 2010 to June 2011 to a minimum of half a cent from July 2013 to December 2014.[127]
Electricity
In 2007, the 2008 NZETS was expected to increase the retail price of electricity by 1 cent/kwh (5%) under a $15 carbon price scenario and 2 cents/kwh (10%) under a $25 scenario.[125] The official "NZETS Question and Answers" fact sheet of September 2007 noted that the NZETS may cause retail electricity bills to increase by 4 or 5%.[126] In 2009 the amended NZETS was expected to increase electricity prices by 5% (1c/kWh) in comparison with an increase of by 10% (2c/kWh) under the original NZETS.[58] In April 2011, a report prepared by consultants Covec for the Ministry for the Environment concluded that the NZETS had no discernible impact on either wholesale or retail electricity prices.[128] In October 2012, the five major electricity generating companies were asked by officials about NZETS costs being passed through in electricity prices. The companies advised that there was no distinguishable or visible impact of the NZETS on wholesale electricity prices.[129]
The Kyoto Protocol (Japanese: 京都議定書, Hepburn: Kyōto Giteisho) was an international treaty which extended the 1992 United Nations Framework Convention on Climate Change (UNFCCC) that commits state parties to reduce greenhouse gas emissions, based on the scientific consensus that global warming is occurring and that human-made CO2 emissions are driving it. The Kyoto Protocol was adopted in Kyoto, Japan, on 11 December 1997 and entered into force on 16 February 2005. There were 192 parties (Canada withdrew from the protocol, effective December 2012) to the Protocol in 2020.
Environmental finance is a field within finance that employs market-based environmental policy instruments to improve the ecological impact of investment strategies. The primary objective of environmental finance is to regress the negative impacts of climate change through pricing and trading schemes. The field of environmental finance was established in response to the poor management of economic crises by government bodies globally. Environmental finance aims to reallocate a businesses resources to improve the sustainability of investments whilst also retaining profit margins.
The Clean Development Mechanism (CDM) is a United Nations-run carbon offset scheme allowing countries to fund greenhouse gas emissions-reducing projects in other countries and claim the saved emissions as part of their own efforts to meet international emissions targets. It is one of the three Flexible Mechanisms defined in the Kyoto Protocol. The CDM, defined in Article 12 of the Protocol, was intended to meet two objectives: (1) to assist non-Annex I countries achieve sustainable development and reduce their carbon footprints; and (2) to assist Annex I countries in achieving compliance with their emissions reduction commitments.
The European Union Emissions Trading System is a carbon emission trading scheme which began in 2005 and is intended to lower greenhouse gas emissions by the European Union countries. Cap and trade schemes limit emissions of specified pollutants over an area and allow companies to trade emissions rights within that area. The EU ETS covers around 45% of the EU's greenhouse gas emissions.
Flexible mechanisms, also sometimes known as Flexibility Mechanisms or Kyoto Mechanisms, refers to emissions trading, the Clean Development Mechanism and Joint Implementation. These are mechanisms defined under the Kyoto Protocol intended to lower the overall costs of achieving its emissions targets. These mechanisms enable Parties to achieve emission reductions or to remove carbon from the atmosphere cost-effectively in other countries. While the cost of limiting emissions varies considerably from region to region, the benefit for the atmosphere is in principle the same, wherever the action is taken.
Carbon pricing is a method for governments to address climate change, in which a monetary cost is applied to greenhouse gas emissions in order to encourage polluters to reduce the combustion of coal, oil and gas – the main driver of climate change. The method is widely agreed to be an efficient policy for reducing greenhouse gas emissions. Carbon pricing seeks to address the economic problem that emissions of CO2 and other greenhouse gases (GHG) are a negative externality – a detrimental product that is not charged for by any market.
The Carbon Pollution Reduction Scheme was a cap-and-trade emissions trading scheme for anthropogenic greenhouse gases proposed by the Rudd government, as part of its climate change policy, which had been due to commence in Australia in 2010. It marked a major change in the energy policy of Australia. The policy began to be formulated in April 2007, when the federal Labor Party was in Opposition and the six Labor-controlled states commissioned an independent review on energy policy, the Garnaut Climate Change Review, which published a number of reports. After Labor won the 2007 federal election and formed government, it published a Green Paper on climate change for discussion and comment. The Federal Treasury then modelled some of the financial and economic impacts of the proposed CPRS scheme.
Certified emission reductions (CERs) originally designed a type of emissions unit issued by the Clean Development Mechanism (CDM) Executive Board for emission reductions achieved by CDM projects and verified by a DOE under the rules of the Kyoto Protocol.
EU Allowances (EUA) are climate credits (or carbon credits) used in the European Union Emissions Trading Scheme (EU ETS). EU Allowances are issued by the EU Member States into Member State Registry accounts. By April 30 of each year, operators of installations covered by the EU ETS must surrender an EU Allowance for each tonne (1,000 kg) of CO2 emitted in the previous year. The emission allowance is defined in Article 3(a) of the EU ETS Directive as being "an allowance to emit one tonne of carbon dioxide equivalent during a specified period, which shall be valid only for the purposes of meeting the requirements of this Directive and shall be transferable in accordance with the provisions of this Directive".
The UK Emissions Trading Scheme is the carbon emission trading scheme of the United Kingdom. It is cap and trade and came into operation on 1 January 2021 following the UK's departure from the European Union. The cap is reduced in line with the UK's 2050 net zero commitment.
Carbon emission trading (also called carbon market, emission trading scheme (ETS) or cap and trade) is a type of emission trading scheme designed for carbon dioxide (CO2) and other greenhouse gases (GHG). It is a form of carbon pricing. Its purpose is to limit climate change by creating a market with limited allowances for emissions. This can reduce the competitiveness of fossil fuels, and instead accelerate investments into renewable energy, such as wind power and solar power. Fossil fuels are the main driver for climate change. They account for 89% of all CO2 emissions and 68% of all GHG emissions.
Climate change in New Zealand involves historical, current and future changes in the climate of New Zealand; and New Zealand's contribution and response to global climate change. Summers are becoming longer and hotter, and some glaciers have melted completely and others have shrunk. In 2021, the Ministry for the Environment estimated that New Zealand's gross emissions were 0.17% of the world's total gross greenhouse gas emissions. However, on a per capita basis, New Zealand is a significant emitter, the sixth highest within the Annex I countries, whereas on absolute gross emissions New Zealand is ranked as the 24th highest emitter.
The Chinese national carbon trading scheme is an intensity-based trading system for carbon dioxide emissions by China, which started operating in 2021. This emission trading scheme (ETS) creates a carbon market where emitters can buy and sell emission credits. The scheme will allow carbon emitters to reduce emissions or purchase emission allowances from other emitters. Through this scheme, China will limit emissions while allowing economic freedom for emitters. China is the largest emitter of greenhouse gases (GHG) and many major Chinese cities have severe air pollution. The scheme is run by the Ministry of Ecology and Environment, which eventually plans to limit emissions from six of China's top carbon dioxide emitting industries. In 2021 it started with its power plants, and covers 40% of China's emissions, which is 15% of world emissions. China was able to gain experience in drafting and implementation of an ETS plan from the United Nations Framework Convention on Climate Change (UNFCCC), where China was part of the Clean Development Mechanism (CDM). China's national ETS is the largest of its kind, and will help China achieve its Nationally Determined Contribution (NDC) to the Paris Agreement. In July 2021, permits were being handed out for free rather than auctioned, and the market price per tonne of CO2e was around RMB 50, far less than the EU ETS and the UK ETS.
The Climate Change Response Act 2002 is an Act of Parliament passed by the New Zealand Government.
The Kyoto Protocol was an international treaty which extended the 1992 United Nations Framework Convention on Climate Change. A number of governments across the world took a variety of actions.
The Climate Change Response Amendment Act 2008 was a statute enacted in September 2008 by the Fifth Labour Government of New Zealand that established the first version of the New Zealand Emissions Trading Scheme, a national all-sectors all-greenhouse gases uncapped and highly internationally linked emissions trading scheme. After the New Zealand general election, 2008, the incoming National-led government announced that a Parliamentary committee would review the New Zealand emissions trading scheme and recommend changes. Significant amendments were enacted in November 2009. Obligations for pastoral agriculture were further delayed. Obligations for energy and industry were halved via a "two for one" deal. Free allocation of units to industry was made uncapped and output based and with a slower phase-out. A price cap of $25 NZD per tonne was introduced.
The Emissions Trading Scheme Review Committee was a special committee of the New Zealand Parliament which conducted a review of the Fifth Labour Government's Emissions Trading Scheme between December 2008 and late August 2009.
The Clean Energy Act 2011 was an Act of the Australian Parliament, the main Act in a package of legislation that established an Australian emissions trading scheme (ETS), to be preceded by a three-year period of fixed carbon pricing in Australia designed to reduce carbon dioxide emissions as part of efforts to combat global warming.
A carbon pricing scheme in Australia was introduced by the Gillard Labor minority government in 2011 as the Clean Energy Act 2011 which came into effect on 1 July 2012. Emissions from companies subject to the scheme dropped 7% upon its introduction. As a result of being in place for such a short time, and because the then Opposition leader Tony Abbott indicated he intended to repeal "the carbon tax", regulated organizations responded rather weakly, with very few investments in emissions reductions being made. The scheme was repealed on 17 July 2014, backdated to 1 July 2014. In its place the Abbott government set up the Emission Reduction Fund in December 2014. Emissions thereafter resumed their growth evident before the tax.
South Korea's Emissions Trading Scheme (KETS) is the second largest in scale after the European Union Emission Trading Scheme and was launched on January 1, 2015. South Korea is the second country in Asia to initiate a nationwide carbon market after Kazakhstan. Complying to the country's pledge made at the Copenhagen Accord of 2009, the South Korean government aims to reduce its greenhouse gas (GHG) emissions by 30% below its business as usual scenario by 2020. They have officially employed the cap-and-trade system and the operation applies to over 525 companies which are accountable for approximately 68% of the nation's GHG output. The operation is divided up into three periods. The first and second phases consist of three years each, 2015 to 2017 and 2018 to 2020. The final phase will spread out over the next five years from 2021 to 2025.
1 2 "New Zealand Units (NZUs)". Climate change information New Zealand. Ministry for the Environment, NZ Government (www.climatechange.govt.nz). 18 June 2010. Retrieved 13 August 2010. In the short term, the Government is unlikely to sell emission units because the Kyoto units allocated to New Zealand will be needed to support New Zealand's international obligations, as well as allocation to eligible sectors under the emissions trading scheme.
1 2 MfE (14 January 2010). "How will the changes impact on forestry?". Questions and answers about amendments to the New Zealand Emissions Trading Scheme (ETS). Ministry for the Environment, NZ Government (www.climatechange.govt.nz). Retrieved 16 May 2010.
↑ MfE (September 2009). "Agriculture". Summary of the proposed changes to the NZ ETS - Emissions Trading Bulletin 11. Ministry for the Environment, NZ Government. Retrieved 16 May 2010.
1 2 MfE (September 2009). "Industrial allocation update". Emissions trading bulletin No 12, INFO 441. Ministry for the Environment, NZ Government. Retrieved 8 August 2010. The Bill changes the allocation provisions of the existing CCRA from allocating a fixed pool of emissions to an uncapped approach to allocation. There is no longer an explicit limit on the number of New Zealand units (NZUs) that can be allocated to the industrial sector.
1 2 3 "New bill 'weakens ETS' says Environment Commissioner" (Press release). Parliamentary Commissioner for the Environment. 15 October 2009. Retrieved 15 October 2009. The allocation of free carbon credits to industrial processes is extremely generous and removes the carbon price signal where New Zealand needs one the most
1 2 3 "Revised ETS an insult to New Zealanders" (Press release). Greenpeace New Zealand. 14 September 2009. Retrieved 12 October 2009. We now have on the table a pathetic ETS which won't actually do anything to reduce emissions
↑ "The New Zealand Emissions Trading Scheme Evaluation 2016"(PDF). Ministry for the Environment. 7 February 2016. Retrieved 31 October 2022. page 40 "The NZ ETS appears to have contributed, but only minimally, to changes in behaviour and decisions that have reduced net emissions below business-as-usual levels."
↑ Craig Foss (Chairperson of the Finance and Expenditure Committee) (20 September 2009). "Questions for Oral Answer – Questions to Ministers, Questions to Members". Hansard. New Zealand Parliament. Retrieved 30 August 2010. The committee began hearing evidence on the bill on Thursday, 15 October 2009, at around 4 p.m.
↑ MfE (September 2007). "4.8.2 Definition of the cap for the NZ ETS". The Framework for a New Zealand Emissions Trading Scheme - 4 Core Design Features. Ref. ME810. Ministry for the Environment. Retrieved 18 July 2010.
↑ MfE (10 June 2010). "About emission units". New Zealand Climate change information. Ministry for the Environment (www.climatechange.govt.nz). Retrieved 7 August 2010.
↑ "National Party Environment Policy"(PDF). 6 September 2008. Archived from the original(PDF) on 25 May 2010. Retrieved 22 August 2009. The ETS should be fiscally neutral rather than providing billions of dollars in windfall gains to the government accounts at the expense of businesses and consumers
↑ "Economics A-Z". The Economist. Retrieved 18 October 2010. Fiscal neutrality. When the net effect of taxation and public spending is neutral
↑ Rt Hon John Key (18 May 2008). "National won't cut corners on ETS at kiwis' expense". John Key, Prime Minister, National Party. Retrieved 18 October 2010. It should be fiscally neutral rather than providing billions of dollars in windfall gains to the government accounts at the expense of businesses and consumers
1 2 3 See ETS Questions Answers, Summary of ETS Changes, factsheets accompanying New Zealand Government Media Release by Nick Smith, Minister for Climate Change Issues, 'Revised ETS balances NZ's environment & economy', 14 September 2009. Retrieved 22 September 2009.
↑ NZEUR (December 2011). "Guide to Emissions Returns - SEIP and LFF sectors — New Zealand Emission Unit Register". New Zealand Emissions Unit Register. Retrieved 6 September 2012. Section 18CB of the Climate Change Response Act 2002 prohibits the use of imported AAUs for compliance purposes. No imported AAUs can be surrendered for NZ ETS compliance purposes as there are no regulations creating an exception to the prohibition.
↑ MfE (September 2009). "Which international units will be accepted for surrender in CP1?". Emissions trading bulletin No 11. Ministry for the Environment (MfE), NZ Government. Retrieved 18 August 2010. A: There are no changes to the types of units that will be accepted into the NZ ETS (ie, CERs, ERUs and RMUs will be accepted)
↑ Catherine Beard (14 September 2009). "ETS Changes Welcome". Greenhouse Policy Coalition. Archived from the original on 13 January 2015. Retrieved 24 September 2010.
↑ Green.view (23 March 2010). "It's not easy seeming green: A backlash to New Zealand's vow of purity". The Economist. Archived from the original on 25 March 2010. Retrieved 25 March 2010. The emissions-trading scheme excludes agricultural emissions until 2015, and its generous allocations of free carbon credits to business have been lambasted by environmentalistsAlt URL
↑ Chauvel, Charles (25 November 2009). ETS debate speech (Speech). speech to third reading of Climate Change Response (Moderated Emission Trading) Amendment Bill. New Zealand Labour.
↑ NZPA (24 September 2009). "Govt gets its ETS bill through first reading". TV3 News. Retrieved 9 August 2012. This is the sort of emissions trading scheme you have when you still think climate change is a hoax
↑ Jan Wright (30 June 2010). "ETS Good but Emitter Subsidies Bad" (Press release). Parliamentary Commissioner for the Environment. Retrieved 5 January 2011.
1 2 MfE (September 2007). "7.2.1 Emissions from electricity". The Framework for a New Zealand Emissions Trading Scheme - 7 The Impacts of the Emissions Trading Scheme. Ref. ME810. Ministry for the Environment. Retrieved 18 March 2015.
↑ "Request 49: Impact of carbon costs on electricity prices p 11". Advice to the Finance and Expenditure Select Committee on the Climate Change Response (Emissions Trading and Other Matters) Amendment Bill -Responses to information requests from the select committee meeting on 26 September 2012. Prepared by the Ministry for the Environment and the Ministry for Primary Industries. 8 October 2012. Retrieved 29 March 2015.
Bullock, David (March 2009). The New Zealand Emissions Trading Scheme: A step in the right direction?. Institute of Policy Studies Work Paper 09/04. The Institute of Policy Studies Victoria University of Wellington.. A 52-page report on the policy background to and detail of the 2008 NZ ETS.
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