Wellington - Wednesday 14 May 2008

Climate legislation needs strengthening

The Environmental Trading Scheme has to be strengthened to ensure all those that emit greenhouse gases have an equal incentive to reduce their emissions, the Environment and Conservation Organisations told the Finance and Expenditure Select Committee today.

"It is essential the legislation does not give big subsidies to smelters, steel producers, oil and gas industry, farmers or anyone else," Cath Wallace from ECO told the Committee. Cath Wallace is also a senior lecturer in economics and public policy at Victoria University.

ECO supports the passage of legislation to implement an emissions trading system and to establish an overall national emissions reduction target and a target for renewable electricity generation. "The system must apply to all sectors and all gases."

"Everyone should pay their share. Cost shifting to taxpayers dampens incentives to reduce emissions, causes economic inefficiency and violates fairness.

"Taxpayers should not have to pay for emissions and neither should householders pay for the burden of industries."

Cath Wallace said income support through the benefit system should be used to get vulnerable households through the transitional costs to a low carbon economy.

"There should be taxpayer support to low income households rather than subsidies to smokestack industry, those that drive SUVs or dairy farmers."

Cath Wallace told the Select Committee it is essential that the trading scheme has environmental integrity. "The law needs to be drafted so that emissions credits that involve losses of rainforests and other ecosystems are not allowed, otherwise we will be addressing one form of environmental damage by causing another."

ECO welcomes moves to more equitably deal with forest owners' sinks and sources under the legislation.

"It is essential that the measures promoting forestry do not result in perverse outcomes which result in the loss of indigenous biodiversity. The forest owners and environmental groups are agreed that all forest plantings should be subject to the provisions of the New Zealand Forest Accord and subsidiary agreements."

Emissions credits must not be available for environmentally damaging sinks such as planting pine trees on wetlands or tussock grasslands. New Zealand's native ecosystems must not be damaged by the scheme.

ENDS

1. ECO - the Environment and Conservation Organisations was established in 1972 and represents 62 groups with a concern for the environment.

2. The key points in the ECO submission 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 10 years since the Kyoto Protocol was signed.

Targets and timetables: Government must make strong commitments in the legislation, with staged milestones. Globally greenhouse gas concentrations should not go over 450ppm CO2 equivalent and steps must be taken to reduce greenhouse levels below that concentration. This will require reductions in greenhouse gas emissions of at least 80-90 percent by 2050 and at least 35-40 percent reduction by 2020.

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 from 2009.

The ETS should ensure environmental integrity of the system by not allowing the bringing of eastern Europe hot air allocations into the system. We welcome the Government's decision not to allow nuclear energy to be included. The environmental integrity requirements should be included in the legislation.

The legislative target of 90 percent renewable electricity system is easily achievable by 2025 and support moving to a 100% renewable stationary energy system in that time.

3. The New Zealand Forest Accord and the New Zealand Climate Change Accord are agreements between the forest sector and environmental interests, including ECO, to protect biodiversity and regenerating native forests and support plantation forestry.

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