Slower ETS welcome but not enough

The slower introduction of the full effects of the ETS is welcome but National’s Environment and Climate Change Policy announced today would impose too much additional cost on businesses and households, says BusinessNZ Chief Executive, Phil O'Reilly.

“BusinessNZ supports New Zealand doing its fair share in global climate change and reducing our greenhouse gas emissions at the least cost possible, but the proposed policy is too much too soon.

“It’s estimated the cost impact on New Zealand transport, energy and industry at a $25 price cap would increase from $243 million in 2011/2012 to $638 million in 2015. Costs for the average household would increase from $125 per year in 2011/2012 to $330 in 2015.

“Until the rest of the world catches up with New Zealand, more balance is needed between reducing emissions and the cost of doing so.

“There is still a lack of action from other countries to take part in emissions trading, so New Zealand businesses are already at a competitive disadvantage. The proposed timeline of phasing in the full ETS obligation will impose extra costs to New Zealand businesses and households at a time when they can least afford it.

“The other concern with this proposal is that it only addresses the short term plan, up until 2015. This does not help provide business with any certainty about the longer term impacts of emissions trading. This will affect investment and jobs.

“There needs to be a more robust review process that allows Government and to engage more with business to develop an ETS for New Zealand that strikes a batter balance for all.”