Climate Change Response (Emissions Trading Reform) Amendment BillLast updated: January 17, 2020
Climate Change Response (Emissions Trading Reform) Amendment Bill
Published: January 17, 2020
Submitting To: Environment Select Committee
Issue for Business: An emissions trading scheme is a market-based policy instrument that provides a cost effective way to assist in controlling greenhouse gas emissions if designed properly. The nature and significance of the NZ ETS has evolved from a nested system under the Kyoto Protocol to a key policy instrument supporting the decarbonisation of the NZ economy at a low cost. Many of the current NZ ETS settings – reflecting legacy objectives or transitional measures – are incompatible, incomplete, or altogether lacking for the purpose of meeting emissions reduction budgets at a low cost. BusinessNZ accepts that the NZ ETS must be reformed. The nature of the changes proposed in the Amendment Bill – and which we address in this submission – is to enable the Minister to recommend regulations on various matters pertaining to the ETS (and specifically, if auctions are introduced). We therefore recognise that (except industrial allocation) the Amendment Bill addresses ETS design changes from a high-level perspective and expect that technical details on these changes will be consulted on separately in the context of amendments to ETS regulations (e.g. as per MfE’s most recent (2019) consultation document on auction price control levels and auction volumes).