New Zealand: Region a net ETS winner

GISBORNE will be a net winner from the emissions trading scheme, promises Climate Change Minister Nick Smith.

At a well-attended meeting last night, Dr Smith managed to tame a potentially hostile audience through judicious use of the expressions:

“Good question”, “You’re absolutely right” and “That deserves a thorough answer — I’ll answer each point in turn”.

Of the 10 portfolios he had held in his political career, climate change was by far the most challenging, said Dr Smith.

“The science is hard. I’m an engineer by training, a pretty practical fellow. I’ve read the science for 20 years and do not claim to understand all of it.

“The international relations of climate change are incredibly complex, trying to get 194 countries to agree to anything, and the economics of it is pretty challenging as well.”

The link between greenhouse gases of human origin and recent temperature increases was about “90 percent certain”.

“There have been many trees lost debating the issue. It has gone on for the better part of my political career, and there comes a time when you just have to have the courage to get on with the business.”

Just as our economy had moved from 10 percent efficient steam engines to 50 percent efficient internal combustion engines, it was time to move up another step in efficient energy use, said Dr Smith.

“We are not doing it because we think it’s good for the world, we think it is in New Zealand’s national interest.

“It is my view that there is a transition to a lower emissions economy and the sooner we start that transition, the better.”

Protection of New Zealand’s brand also demanded decisive action, he said.

“The Economist magazine had an editorial in March this year that said New Zealand can not go around the world telling people we are 100 percent pure and clean and green when our emissions are the worst of any developed country.”

An emissions trading scheme had been chosen as the best way to prompt a shift towards a greener economy, said Dr Smith.

“Most people would say we need to reverse deforestation and plant more trees; that we need to generate more power from renewable sources and the ETS is the practical way to make those things happen.”

Legislating the type of car, showerhead or hot water cylinder people were allowed was not the answer, he said.

“We want to say to people — if you want to drive around in a big V8, if you want to have a long shower in the morning and get a good drenching, well, we’re not going to boss you around about that. But you shouldn’t expect other people to meet the environmental costs associated with it.

“(The ETS) gives the process some transparency in the trade-off between how much you want to reduce emissions and how much you are willing to pay.”

A five-yearly review of the legislation was vital in maintaining New Zealand’s position as a country doing its share, but the costs were relatively easy to offset, targets could be exceeded at a profit and estimates of costs had been high so far.

“Unless there are practical technologies by which farmers can reduce emissions — doable and affordable — a National Government will not include the farming sector in the ETS in 2015.”

From now to the end of 2012, the Government would receive about$900 million through the ETS, but there will be $1600m paid out to foresters.

The cost to the average household would be about $160 per year — about $3 per week — and there were plenty of ways a household could save more than that using some simple measures, and so could farmers, said Dr Smith.

“We went to Mystery Creek and there were plenty of innovations and technologies to allow farmers to be more efficient.

“If a farmer planted six hectares of unproductive land, they would receive $4000 per year — more than off-setting the cost of the ETS.”