Emitters are now on their way to paying the full cost of their carbon emissions in New Zealand, says Climate Change Minister Paula Bennett.
“As part of our ongoing work programme to reduce domestic emissions we have started the three-year phase out of the one-for-two emissions trading scheme subsidy,” says Mrs Bennett.
“This subsidy allowed some businesses to pay one emissions unit for every two tonnes of pollution they emit. Last year the Government announced we are phasing the measure out over three years to give businesses time to plan and adjust.”
The initial 50 per cent unit cost increased to 67 per cent from 1 January, and will rise to 83 per cent from 1 January 2018. All sectors in the ETS will pay the full market price from 1 January 2019.
“It is vital for businesses that we have certainty in our long-term response to climate change. Following the second stage of the ETS review this year we will set a clear long-term direction on how the ETS will help meet our ambitious emissions reduction targets,” says Mrs Bennett.
“Meeting our Paris Agreement targets will require more than business as usual. Alongside the ETS review, we have established three expert groups to help get more trees into the ground, reduce agricultural emissions, and adapt to the environmental impact of climate change.
“We’re also investing $2 billion on public transport, setting targets to increase the number of electric vehicles year on year until 2021, investing $20 million a year in agricultural greenhouse gas research and providing $200 million for international climate-related support.”
Recommendations from the second stage of the ETS review are expected in mid-2017 when the review is scheduled to conclude.