03, Jul, 2012

Emissions Trading System needs strengthening to be effective

Category: News

The Government’s further weakening of New Zealand Emissions Trading System are a major disappointment and will further undermine the effectiveness of the control of climate and ocean damaging pollution, the Environment and Conservation Organisations (ECO) says.

Emissions will continue to climb, but the scientists are urgently telling us we must reduce emissions fast says ECO co-chair, Cath Wallace.  “This is not going to help New Zealand meet greenhouse pollution reduction targets needed by 2020 or the 90 percent cut required by 2050.”

“The changes allow 65 large companies further long periods of subsidisation by taxpayers, particularly by households, right out to 2050, with farmers and the fishing quota holders continuing getting especially large subsidies.”

Cath Wallace said the Government was passing on both cost burdens and difficult politics to future generations.  “It further indicates that the Government has not got a strategy to meet its own commitment to cut greenhouse gas emissions by 50 percent by 2050.”

“This decision is announced at the same time as the science of critical and irreversible damage to the climate and the oceans is getting much more certain and that action is desperately needed.”

“Failing to make a decision on farming further delays incentives farmers need to regear and reduce emissions.  It is important for economic efficiency and fairness that farms make to start paying the costs of nitrous oxide and methane emissions which make up nearly 50 percent of New Zealand’s emissions.”

“Struggling households and small businesses will have either to pay for these subsidies in their taxes or to forego public services like health care and education.  This Government’s announcements will further increase in taxpayer subsidy to polluters in addition to at least $400million.” 

“The continuing industry subsidies will have trade implications too because they mean New Zealand will no longer be able to claim that farming are not subsidised. These subsidies are set to continue right out to 2050 and they are massive: about $1 billion.”

"Not only do these subsidies lead to inefficiency and unfairness, they will also send wrong price signals to investors which will result in a deadweight loss to society as well as harming the climate.”

“New Zealand’s international standing, especially in Europe and the Pacific, will be seriously damaged by the failure to take a strong stand to reduce emissions and by this further back tracking and subsidization.”



1.    An ICF International report to MAF in 2009 shows that over 13% of New Zealand’s agricultural emissions (nitrous oxide) can be cut profitably to farmers: to reduce emissions of 5 megatonnes per year (ICF International, 2008. Analysis of the potential and costs of greenhouse gas reductions, Aug 2008).  Nitrous oxide emissions have risen 26% since 1990.

2.    Agricultural emissions makes up 47.1% of New Zealand’s greenhouse gas emissions compared to energy emissions at 43.4%.  New Zealand’s breakdown of greenhouse gas emissions in 2010 are 37.5% are methane (CH4) and 14.6% nitrous oxide (N2O) while carbon dioxide (CO2) is 46.3%. Other main greenhouse gases make up 1.6% of emission and include hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulphur hexafluoride (SF6).  Since 1990 carbon dioxide emissions have risen 32.7%, methane emissions by 4%, and nitrous oxide emissions by 26%.  (Ministry for the Environment April 2012)

3.    New Zealand’s greenhouse gas emissions have risen by 19.8% between 1990 and 2010 and New Zealand is the 13th highest per capita greenhouse gas emissions at 18.3 tonnes of CO2 equivalent per person (Ministry for the Environment, April 2012).  New Zealand’s per capita emissions are higher than the United Kingdom, Japan and about triple the world average.

4.    The fishing industry is likely to be one of the most affected industries from ocean acidification caused by increased carbon dioxide levels and should be leading moves to reduce emissions.  Shellfish fisheries (eg oysters, mussels and scallops) are likely to be among the most affected as ocean acidification reduces sealife’s ability to make shells.

5.    In March 2011, the Government notified in the New Zealand Gazette a target for a 50 per cent reduction in New Zealand greenhouse gas emissions from 1990 levels by 2050.  In August 2009, the Government announced a 2020 target range of greenhouse gas emissions reductions of between 10 per cent and 20 per cent below 1990 levels by 2020.

6.    Limiting warming to 1.5 to 2oC will still be likely to result in sea-level rise of 75-80 cm by 2100 by 2300 gives a median estimate of 1.7 and 2.7m respectively (Schaeffer et al 2012, Long-term sea-level rise implied by 1.5 and 20C warming level.  Nature Climate Change, June 2012).

7.         The key points on climate change by ECO are:

  • Action must be taken as soon as possible to reduce greenhouse gas (GHG) emissions.  It is about time New Zealand acted since it is 15 years since the Framework Convention on Climate Change (FCCC) was signed and over 10 years since the Kyoto Protocol was signed.


  • Targets and timetables: Government should make strong commitments in the legislation, with staged milestones.  New Zealand greenhouse gas emissions should be reduced by 40 percent by 2020 and by at least 80-90 percent by 2050.


  • Taxpayers should not be left paying for the costs for polluters for the Kyoto and future obligations.  All sectors should do their share of emissions reductions including methane and nitrous oxide reduction, and this includes agriculture and the New Zealand fishing industry in New Zealand waters and globally.


  • There should be no subsidies to various sectors through providing free allocations or delaying the introduction of sectors into the ETS.  It is essential that all sectors are introduced into the system.


Previous page: Current Events