Ambitious plan, light on detail

Ambitious plan, light on detail

BusinessNZ says Labour’s ambitious plan to reduce New Zealand’s greenhouse gas emissions is light on the detail needed to provide business and communities with the confidence to plan their future.

BusinessNZ Chief Executive Kirk Hope said Labour’s new targets of net zero carbon emissions by 2050 and net zero total emissions by 2100 is more ambitious than its former goal of a 40 percent reduction by 2030 and required greater clarity about how it would work.

"Questions such as what carbon price would be required to achieve it, and who will set this price, will it be higher than the prices being paid by our trade competitors, and who will bear the impacts of the change - these questions need answers.

"Before we can support the new targets, we need to know the price of carbon - or other policy interventions - that would deliver zero net carbon emissions.

"Handing over this task to a Commission provides no confidence to transport logistics companies, farmers, emissions-intensive export industries struggling to remain internationally competitive or families paying their fuel and electricity bills.

"What does a ‘rapid but just transition’ mean for the businesses, workers and communities around the Glenfield steel mill, the methanol plant at Waitara or the Bluff smelter?

"We welcome the signal that free units will continue to be allocated to trade-exposed businesses but this makes meeting a net zero carbon target even more challenging for the transport sector.

"Work undertaken by the BusinessNZ Energy Council has shown that even with low population and economic growth assumptions, carbon emissions reductions in the energy sector are difficult to achieve without a high carbon price or heavy government intervention."

Mr Hope said New Zealand would not be able to plant enough trees to offset emissions to reach net zero carbon by 2050, nor could it buy enough overseas carbon credits to offset the amount of reduction required, and this raised the prospect of downsizing economic activity to reduce emissions to meet Labour’s ambitious target.

"Business, industry and farming need to know more about the likely transition before they can support a net zero emissions goal."

ENDS

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