Fran on ETS

Fran O’Sullivan writes:

John Key’s refusal to postpone the implementation of the next phase of the emissions trading scheme (ETS) is setting the scene for a ‘winter of discontent’ with New Zealand business.

In just two days the perception of the Key Government as a climate change laggard has morphed into an unwitting climate change leader as our major trading partners, like Australia and the United States, prepare to defer their own schemes leaving this country out in front of the pack instead of the “fast follower” the PM promised.

The decision by Kevin Rudd to delay his ETS until 2013 does place pressure on NZ. It is almost ironic that National is at risk of accidentally achieving Helen Clark’s aim of being a global leader rather than a fast follower in terms of responses to climate change.

Of course the Australian ETS has never been passed into law – it is easy to delay something not yet legislated for.

The NZ ETS was passed into law by Labour in 2008, and them amended by National in 2009. It is already in effect for sectors such as forestry.

The Auckland Regional Chamber of Commerce has been adding fuel to the fire by asking its membership to email Key directly to ask for the July 1 cost hikes to be deferred.

The chamber reckons it will increase electricity prices by 5 per cent and add 4c a litre to the cost of petrol and diesel. Its boss Michael Barnett reckons the cost hikes will jeopardise the profitability of small to medium businesses as they get back on a growth curve after the lengthy domestic recession.

I’ll have to read the ETS legislation to check, but am unsure whether or not the Government can defer the entry of those sectors, without amending or repealing the ETS law. If a law change is needed, it couldn’t realistically be done by 1 July.