Tag: Tim Groser

NZ ETS, you are the weakest (international) link

Simon Johnson (Mr February) argues that the New Zealand Emissions Trading Scheme (NZETS) is “the weakest link” due to its high exposure to the international carbon market. The strong “international linkage” is the other side of the coin of the uncapped design of the NZETS. Both features reinforce just how ineffective the NZETS is in providing an incentive to reduce greenhouse gas emissions.

Who remembers the The Weakest Link? The quiz show with Anne Robinson the disciplinarian female host with the popular catchphrase “You are the weakest link. Goodbye!” Yes that’s today’s bonkers metaphor for another post on the NZETS. In addition to the observation that I would love to say “Goodbye!” to the ETS, there really is a relevant connection to the economics literature.

“Linking” of emissions trading schemes means that units from one ETS can be imported and surrendered by emitters regulated by a different ETS. There are papers and blog posts about international linkage. The key economic benefit claimed for linking two or more ETS, assuming that they are otherwise sensibly designed, is that the lowest-cost ways of reducing emissions within the linked schemes become available (via emissions trading) to the emitters of the linked schemes.

Continue reading “NZ ETS, you are the weakest (international) link”

Groser underplays the real risks

I listened to Climate Change Minister Tim Groser being questioned about the ETS on The Nation last weekend and explaining that the government’s position on climate change action is that we will play our part in the global effort, doing our fair share but not more. It confirmed my impression that Groser’s focus is on our negotiating position, not on the reality of the threat of climate change. He is intelligent and articulate in his exposition and it all sounds reasonable as far as it goes. The fact that in terms of realistically tackling climate change the global effort doesn’t go nearly far enough was not mentioned during the interview either by the questioners or the Minister.

The government doesn’t deny the science. It doesn’t refuse to participate in global action. What more is it reasonable to ask? A good deal more, as I see it. The complacency which attends Groser’s defence of the government’s position is not justified when one considers the reality of climate change which is already unfolding around the globe and is only going to intensify.

Continue reading “Groser underplays the real risks”

Government confirms NZ ETS to be watered down

I listened sadly on the news last night to the conviction with which the Climate Change Minister Tim Groser announced “This is not the time to put the foot on the accelerator”. Admittedly he followed immediately with “nor, as the climate change sceptics would have wanted us to do, to back the ETS truck up the drive”, but the unfortunate image remaining is of the ETS truck sitting idling at the foot of the drive waiting, or at best crawling at snail’s pace along the road.

Groser is not a climate change sceptic. He claims to fully accept the science. But he obviously does not accept the science when it says that it is already past time when we should have begun reducing emissions, and the window of opportunity is near closing. In other words this is the time to put the foot on the accelerator if we place any value on the human future, or have any care for those already enduring the adverse effects of warming.

Continue reading “Government confirms NZ ETS to be watered down”

Weakened NZ ETS not responsible economic management

Tim Groser, the new Minister for Climate Change Issues, is adamant in his defence of the intention to further delay bringing the agricultural sector into the Emissions Trading Scheme beyond the current date of 2015 unless there are adequate abatement options open to them by then and unless other countries step up to the mark with mitigation measures.  His remarks on Morning Report on Thursday made it clear that the interests of the overall economy were more important than mitigation of the 0.2% of the global greenhouse gas emissions that New Zealand is responsible for.  He spoke of the difficulty of managing the economy through tough times.

Continue reading “Weakened NZ ETS not responsible economic management”

NZ ETS to be watered down (again), but emissions news good

New Zealand’s new Minister for Climate Change Issues and chief climate negotiator, Tim Groser, yesterday announced the government’s intended changes to the Emissions Trading Scheme following last years ETS Review. There will be a limited period for consultation (to May 11) on the proposals before legislation is put before Parliament. The consultation document (PDF) and meeting dates are available here. Key points:

  • Agriculture’s entry to the ETS may be delayed beyond 2015.
  • There will be no increase to the $25/tonne unit price cap.
  • The “two for one” transitional provision for big emitters will be phased out more gradually.
  • The government will give itself powers to auction emissions units.
  • There will be a review of the allocation of carbon credits to pre-1990 forests to take into account the changes to the forestry regime agreed in Durban last year.

Groser also announced the release today of New Zealand’s net emissions position for the 2008-12 Kyoto reporting period, now expected to be a surplus (that is, under NZ’s target) of 23.1 million tonnes, up from 21.9 mt in 2011.

News that agriculture may continue to escape carbon constraints is hardly surprising, given the government’s reluctance to annoy its heartland farming and agribusiness supporters, but it appears willing to risk confrontation with Maori forestry interests on pre-1990 carbon credit allocations. My view is that this tinkering around the edges of the scheme is designed to put the ETS into a kind of domestic political holding pattern until the shape of future international arrangements begins to emerge. Groser doesn’t want to frighten the horses until he absolutely has to, as this quote from Brian Fallow’s piece in the NZ Herald today might be taken to indicate:

Preferences for changing areas of the policy would vary a lot depending on what assumptions were made about the future carbon price, Groser said.

“If you think it will remain at the current low levels, you will reach one set of conclusions. Take a different view of the trajectory of the carbon price – and above all, this is a long game we are playing – and you may reach quite different conclusions.”

Getting international action on emissions reductions is certainly turning out to be a long game. We can only hope that it doesn’t turn into the diplomatic equivalent of a timeless test, and that the climate system is kind enough to give us time to play it. I’d not want to bet on either proposition.