Australia and NZ ETS

Brian Fallow makes some very sensible points on the move by both countries towards an ETS:

Australian professor Ross Garnaut has some good advice for our Government as well as his own.

“The review suggests that prior to the indelible conclusion of [emissions trading] scheme design in either country, the Australian and New Zealand Governments meet at ministerial level to discuss linking and to identify any impediments to linking that may warrant adjustment to one or both scheme designs.”

This is sensible, and it is in fact quite vital that the NZ and Australian schemes are as compatible as possible as Australia is our largest trading partner. This is one reason I think we should be slightly less hasty with pushing our ETS into law. Having trans-Tasman harmony is more important than artifical dates such as the election.

Its draft report was released last Friday and a government green paper is due soon. Climate Change Minister Penny Wong is standing by a timetable that has legislation introduced by the end of this year and an emissions trading scheme up and running in 2010.

Which is compatible with NZ – esp that Clark has delayed all sectors but forestry until 2011.

If Australia’s scheme is along the lines recommended by the Garnaut review there will be a family resemblance with the New Zealand scheme, but there are notable differences.

They need not constitute a barrier to linkage between the schemes – a common carbon market, if you will. The environmental integrity of both schemes should be the determining factor there.

But it would be prudent to be sure the differences do not pre-empt linking before anything is set in concrete.

Absolutely.