Emissions target biggest challenge yet for NZ Inc

Media statement Tuesday, August 11th, 2009

Emissions target biggest challenge yet for NZ Inc

In financial terms the challenge to reduce New Zealand's emissions by 10 to 20 per cent below 1990 levels is the largest we have ever faced, the Employers & Manufacturers Association (Northern) says.

"At an average 15 per cent reduction, the cost of $30 per week per head amounts to $6.7 billion each and every year, said Alasdair Thompson, EMA's chief executive.

"This is more than the total of all our lamb, beef and other meat exports. It represents about 60 per cent of our total dairy exports.

"The challenge for New Zealand is as big, or bigger than when the UK entered the European Common Market (EU).

"Its the price we are being told in effect we need to pay - nearly five per cent of GDP - to retain access to world markets, mostly for our agricultural products.

"A good part of the $6.7 billion a year is expected to be spent by government to purchase carbon offsets on the international market.

"If the final figure is a 10 per cent reduction on 1990 levels, the actual cut required is 30 per cent from current emission levels.

"If the final figure is 20 per cent, the reduction required is 40 per cent from current levels.

"These cuts have to be achieved in just 10 years, which is too short a time for new energy efficient technology to help out much. By 2050 though, new technology will likely be developed to provide considerable help.

"A 50 per cent cut by 2050 is therefore more achievable than 10-20 per cent by 2020.

"A commitment of this magnitude will severely restrict future options such as making tax cuts or changing other policies.

"The New Zealand 2020 target compares with the USA (0 percent), Canada (3 percent), and Australia (4-14 percent though not final).

"All New Zealanders will meet this cost, not business, and little has been done so far to educate our people on how they can reduce the costs they will have to bear."

ENDS

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