Business leaders: Emission trading criticism silly

Business leaders: Emission trading criticism silly

Business organisations complaining about the potential cost of emissions trading are like people deciding to attend a heavy metal concert and then objecting to the noise.

The very point of emissions trading is to expose businesses to the marginal cost of their emitting behaviour, the New Zealand Business Council for Sustainable Development says.

In that way they will either pay for those emissions, through buying emission units through the trading system, or cut back or stop their emissions to avoid the cost.

And most businesses in New Zealand support this, the Business Council's Chief Executive Peter Neilson says today in response to those whom he says would try representing major electricity users and emitters as if they were the majority of business.

Under the electricity trading system the lowest cost generator required to meet the market demand is dispatched and sets the price for electricity in that half hour. If that marginal generator is a wind, hydro plant or geothermal plant, there will be no carbon cost included. If a fossil fueled plant is the last dispatched then it will include the cost of carbon.

"The proposed emissions trading system will help a business find the cheapest way of living with the overall emissions cap."

In the US their experience with cap and trade regimes in combating air pollution was that the cost was far less than had been expected when the scheme was first mooted.

By numbers, most New Zealand firms do not have a major exposure to the coming price on carbon. The main exposure for most is in their air travel and car use. Like most households, they're spending much more on petrol than the power bill.

"You can't encourage households and firms to move to things which emit less without increasing the price of things which emit carbon into the atmosphere. That's the way the emissions trading system works. Rather than just talking the book of the largest emitters, business organisations should be helping their members to adapt and go out now and measure their emissions. This includes farmers, whose emissions will be applied at 90% of 2005 levels from 2013. There's no free ride."

54% of business people agree with emissions trading while only 23% oppose, according to research conducted nationwide for the Business Council by ShapeNZ. Results are at http://www.nzbcsd.org.nz/_attachments/Climate%5FChange%5FII%5Fsurvey%5FJune%5F20072%2Epdf

ENDS

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