A new coalition of groups today launched the Don’t Subsidise Pollution campaign, calling for an end to free carbon credits and introduction of a Carbon Border Mechanism to decarbonise Aotearoa’s emissions intensive industries like concrete, steel, and aluminium.

Following the passing of a law change that tightened up the overallocation of free credits earlier this month, the coalition, coordinated by Common Grace Aotearoa and including New Zealand Green Building Council, Engineers for Sustainable Development and Generation Zero, want to see political parties commit to getting rid of the system of free carbon credits altogether.

“Subsidising pollution in a climate crisis just doesn’t make sense” said Common Grace Aotearoa advocate Alex Johnston, organiser of the coalition.

“When we all play our part in cutting climate pollution, then we can get further to meeting our targets together, and faster. But as cyclones and floods devastate communities across Aotearoa, the people in government are incentivising large multinationals to continue business as usual.”

“We invite all parties committed to action on climate change this election to say a government they are in will stop subsidising pollution,” said Johnston.

“Under current legislation, these companies will still be getting free credits for decades to come, even after the whole country is meant to be at net zero emissions. Meanwhile, everyday households play their part by paying the carbon price in our petrol and electricity bills.”

“The recent announcement of NZ Steel’s decarbonisation plans with support from government, shows that these industries can transition, and that free carbon credits are no longer needed.”

The Don’t Subsidise Pollution coalition is calling for the free credits to be gone by 2030, and in their place introduce a Carbon Border Mechanism, an environmental tariff that the European Union is phasing in from October. This would equalise the costs of importing more carbon intensive products from overseas to ensure an equal playing field.

The group also wants to see government help maintain demand for domestically produced cement, steel and wood through green infrastructure investment via public procurement or a Ministry of Green Works. This, together with upfront loans that contribute to the cost of businesses to decarbonise their production process would help make sure most industries currently getting free credits aren’t outcompeted overseas even as they face the full cost of their emissions.

Andrew Eagles, Chief Executive of the New Zealand Green Building Council believes it is an idea whose time has come: “By ratcheting down free ETS credits, we’re incentivising ambitious climate action from our biggest polluters, and we can use that money to actually invest in real change.

By removing free allocations funds are freed up to better support the transition to a zero carbon future.”

“There’s often concern that the cost of decarbonising may leave New Zealanders flocking to cheaper, higher polluting off-shore alternatives. A Carbon Border Mechanism, as the EU is taking ahead, will help level the playing field, and ensure New Zealand industry can remain competitive while tackling their emissions.”

Alicia Hall of Parents for Climate Aotearoa said "Our young people have been appealing to us for five years to step up and make the right decisions now. It is utterly unacceptable to continue subsidising emissions that allow polluting activities that will negatively impact their lives. We support ending these subsidies and working together across government, business and communities, to move to renewable energy as quickly as possible. It is our responsibility to do so, for all our children and grandchildren."

The campaign has the support of faith communities, with Bishop Justin Duckworth, Anglican Bishop of Wellington believing the status quo is not fair: “It’s crazy that some of our most polluting industries are subsidised when everyday New Zealanders are paying their share during a cost of living crisis. We need to all take responsibility for our emissions.

These asks make sure we are all shouldering the cost of transitioning to a more sustainable future, while providing a hopeful future for workers who are in industries that desperately need to change."

Johnston said: “If any subsidies should be put in place in the transition to a zero carbon future, it should be to support the transition of industries, not prop up their pollution. We need to end free carbon credits to cut pollution faster and unlock green jobs for Aotearoa’s industrial future”

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