29 Apr 2010

Agriculture's entry into ETS may be put back

7:55 am on 29 April 2010

The Government is hinting that agriculture's entry into the Emissions Trading Scheme could be delayed.

The agricultural sector is due to enter the scheme in 2015.

The Australian federal government decided on Tuesday to wait until the Kyoto climate pact lapsed in 2012 before pushing ahead with its own proposed emissions trading scheme.

New Zealand's Climate Change Minister, Nick Smith, says that when this country's ETS - due to take effect in July - is reviewed next year, the developments in Australia will be taken into account.

Mr Smith says that no final decisions on changes to the ETS will be made until after the review but that if major trading partners have not made progress on their schemes, then the Government would have to reconsider including agriculture from 2015.

NZ would be 'on its own' if scheme proceeds

The Northern Employers and Manufacturers Association has urged the Government to follow Australia's lead and delay the introduction of the scheme.

Association chief executive Alasdair Thompson told Morning Report that New Zealand shouldn't be the first country to implement the scheme.

"We'll be sitting out there on our own, our exporters will be having higher costs, all of the people of New Zealand, all of the businesses will face higher costs," he says.

"It makes us less competitive and we're already in difficulties."

Federated Farmers' spokesperson on the issue, Lachlan McKenzie, also says New Zealand should be following the Australian decision.

Forest owners are commending the Government for sticking to its guns on applying emissions charges to fossil fuels from July.

They say unwinding the ETS now would be complex and costly and it would reduce the incentive for new forestry plantings, which earn carbon credits under the scheme.