ETS reactions #1

NzetsReaction to the emissions trading scheme (ETS) has not been slow coming in, and so far the government seems to have pulled off a remarkable balancing act, gaining at least grudging support from most quarters. Bill English was quick to say that the ETS looked “broadly sound

4 thoughts on “ETS reactions #1”

  1. There was no mention of nitrification inhibitors as a way for the agricultural sector to make a start on emissions reductions – odd, because they were mentioned in the discussion documents, and because they look very promising.

    I called Jim Anderton’s office to inquire about this on Thursday, and was told that the nitrogen tax / inhibitor subsidy floated in the discussion document had been dumped as it was not cost effective. It was unclear though which bit undermined the CBA. Maybe something to OIA?

  2. Well, Simon Terry would disagree about the cost effectiveness…

    I suspect that it has more to do with the fact that introducing action on nitrous oxide in advance of methane and other gases would mean making decisions about the structure of the agricultural scheme sooner rather than later. They didn’t want to scare the horses, in other words.

    After the election, and if the world (through the post-Kyoto negotiations) decides to tighten the GHG screw, we do at least have something we can do relatively quickly.

    In the meantime, it would be interesting if someone could have a stab at the sums: It might be cheaper for the govt to subsidise the use of NIs and get some real reductions in GHGs during the 1st commitment period than to buy offsets in 2012…

  3. The problem is we don’t know what the price of carbon will be in CP1, let alone CP2. But with a general presumption for reductions sooner rather than later, it seems madness not to take the opportunity to make easy reductions now. Particularly when the co-benefits for water quality are so large.

    I don’t think there’d be any incompatibility. Hell, fertiliser companies could easily have been included in the scheme; I think it was more buying off the farmers and not giving them an excuse to drive another tractor up parliament steps and wage an anti “fert tax” campaign in election year that was the issue.

  4. From a climate impact point of view, early reductions are much better than later ones – but they are politically more difficult, and the good they do remote (decades away), so it’s not surprising that imminent elections command more immediate attention. And tractors.

Leave a Reply