Labour released its climate policy yesterday.
Already in the election campaign I have fronted on climate change in a number of public meetings, with Labour (and National, and ACT….), with several more events still to go. Inevitably one of the questions asked is – how might Green and Labour climate policies reconcile if you are required to form a coalition government?
The answer is the same on climate policy as with all other policies: it will be a numbers-oriented negotiation around a table. Weighting will derive from the democratic election verdict.
But as we go into the election campaign, there is no doubt in our mind that the Greens’ policy reflects a more acute sense of urgency, a greater acknowledgement of the magnitude of the challenge, and a more resolute determination to begin the economic transformation to a carbon-neutral society.
There is a fair bit in common between Green and Labour climate policies.
- A national risk assessment, as called for in the ‘Wise Response’ petition, including the need for an adaptation strategy.
- An independent climate commission, one that reflects the British model that is enshrined in legislation and proving to be so effective.
- Five-yearly carbon-budgeting.
- Measures to ensure a just transition in which households, firms and farms that are genuinely participating in response to incentive are properly supported.
- A suite of effective complementary measures in energy and transport, investment, agriculture and forestry to assist in mitigation.
- More constructive and purposeful participation in the international negotiations for an effective global treaty.
There are differences, however, in the end-goal, the speed of change and the method.
- Labour speaks of a “more sustainable, low-carbon, future”. The Greens speak of ‘net carbon-neutrality’. Ours is more specific and more ambitious – an imperative, essentially.
- On timing, we specify 2050 as the target date. Labour appears to be a bit more indeterminate.
- And on the method – the economic instrument – Labour would retain the emissions trading scheme (ETS), while the Greens would switch from a market to a fiscal mechanism.
Green support for the original Labour ETS was always predicated on an understanding that the scheme would be strengthened from the beginning in 2008. But National’s gutting of the scheme in ’09 and again in 2012 has effectively killed the scheme. It has gifted New Zealand unites (NZUs) to polluters and halved their surrender obligation to cut emissions. It has allowed New Zealand businesses to buy cheap foreign offsets and pocket the more valuable NZUs they were gifted (a process known as arbitrage). It has discriminated unfairly against forestry in favour of business and farming. Essentially, the ETS encourages emissions.
So, the Green Climate Protection Plan to dismantle the ETS and introduce a carbon tax will ensure that carbon polluters take responsibility for what they are doing, and face a strong inducement to transition away from fossil fuels.
Labour would “continue with free allocations for carbon-intensive industries exposed to export competition, such as steel and aluminum”.
The problem with this is that it presumes a problem of necessary industry protection, and integrates that presumption into economy-wide policy.
In contrast, the Greens would externalise the problem and, to the extent that it genuinely exists, invite individual companies to apply to an appropriate body (either the Commission or the Environmental Protection Agency) with proof of potential hardship, before relief is granted. This preserves the integrity of the central component of the Climate Protection Plan. It will, in short, be more effective.
On agriculture, Labour would gift free NZUs to 90% of the sector’s 2005 emissions, – about 37 m.t. CO2-e each year. That means only 10% will be exposed to a surrender obligation, of which half can be in the form of doubtful international ‘hot air’ credits. That effectively means $60+ m. in 2016 for greenhouse gases from NZ agriculture. The Green Plan will tax dairy at $12.50/tonne, and let the Commission determine when other agricultural sectors should participate.
Notwithstanding these differences, Green and Labour climate policies are clearly headed in the direction of emissions reductions, rather than the ever-increasing emissions growth the National Party will bring. It is now clear to voters that a new government will take the issue of climate change seriously.
To be continued – on the hustings, and especially from 21 September 2014.