Consultation is now open on Aotearoa’s first emissions reduction plan

The Government has published a discussion document on Aotearoa’s first emissions reduction plan (ERP) and emissions budgets for 2022-2035, Te hau mārohi ki anamata Transitioning to a low-emissions and climate-resilient future (Discussion Document).  A final ERP and emissions budgets for 2022-2035 will be issued by the Government by 31 May 2022 in light of consultation on this document.  Those decisions will influence economic activity for the next 14 years.

The Discussion Document sets out proposed emissions budgets for 2022-25, 2026-30 and 2031-35 (which the Government has agreed ‘in principle’) and proposed principles, policies and strategies to achieve the emissions budgets across a range of sectors.  It has been informed by and responds to the Climate Change Commission’s advice that was released on 31 May 2021.

Below we summarise in-principle decisions that have been made by Government on the emissions budgets and comment on proposed principles, policies and strategies that may be included in the ERP and will affect you and your business.  We also discuss the issues you should be considering in preparing a submission on the Discussion Document.

The Government has made in-principle decisions on emissions budgets

The Government has made an in-principle decision to broadly accept the Commission’s advice on emissions budgets with some modifications.  These are mainly to take account of recent developments, especially changes in projected forestry emissions.

These are the in-principle emissions budgets:

Budget period 2022-25 2026-2030 2031-2035
All gases, net (AR5)[1] 292 307 242
Annual average 73.0 61.4 48.4

(These incorporate changed forest emissions projections.)

The Government is seeking feedback on new approaches to achieve the emissions budgets

The Discussion Document proposes:

  • Key principles intended to guide the overall strategy of the ERP and a transition to a low-carbon economy; and
  • New climate change policies and strategies that the Government is intending to include in the ERP i.e. strategies and policies that are not already in place, or a work in progress.

The guiding principles are broadly aligned with those set out in the Commission’s advice and include:

  • A fair, equitable ad inclusive transition;
  • An evidence-based approach;
  • Environmental and social benefits beyond emissions reductions;
  • Upholding Te Tiriti o Waitangi; and
  • A clear, ambitious and affordable path.

The new policies and strategies that the Government is intending to include in the ERP are set out in Table 4 (pages 14 – 16).  These are broken down by sector.  Decisions are still to be made on these matters and will depend on consultation feedback, future funding decisions (including future budgets) and decisions about how the policies will be implemented.

Notably many of the proposed policies and strategies propose the development of another specific future plan such as an Equitable Transitions Strategy, Freight and Supply Chain Strategy, and Energy Strategy.  In that way the Discussion Document and the future ERP are plans to make plans.

All sectors will be affected by the first ERP especially transport and high-emissions industries

Like the Climate Change Commission’s Advice, the proposals in the Discussion Document are wide reaching and will (directly or indirectly) affect the whole economy.  Businesses in every sector are exposed to the changes, especially those in transport and high-emissions industries.  These are the sectors the Government wants to get reductions from quickly.

In this plan to make plans, the Government is indicating an openness to input from the private sector.  The Discussion Document seeks proposals from the private sector on barriers to reducing emissions and how the private sector can work with the Government to deliver reductions. There are also opportunities for businesses to be involved in industry consultation on future policies and plans.

You can provide feedback on some aspects of the ERP

The first ERP was legally required by 31 December 2021.  However, the Government is in the process of changing the law so that deadline becomes 31 May 2022.  The reason given for the delay is to allow for fulsome consultation on ERP proposals given the current Covid-19 restrictions.  In line with this approach, the Government is inviting submissions on the Discussion Document until 24 November 2021.

Despite a request for input, consultation will not cover all emission reduction proposals.  It excludes:

  • Several in-principle decisions on climate change policy that have already been made by the Government.  Some of these are noted in the Discussion Document (such as the emissions budgets) and some will be announced at the upcoming UN Climate Change Conference of the Parties (COP26) in Glasgow.
  • Parts of the ERP that have already undergone consultation during previous policy development or via the Climate Change Commission’s consultation.  The Discussion Document does not identify which parts of the previous policy development or Climate Change Commission’s consultation excluded on this basis.

There are specific issues you should consider providing feedback on

Your feedback should focus on the proposals included in the Discussion Document and the role you and your business will play in the transition to a low carbon economy.

  • In preparing your feedback on the Discussion Document you should consider:
  • What are the practical implications of the proposals for your organisation?
  • How will the proposals change the regulatory environment in which your sector operates?
  • How will the proposals change the way your business plans and budgets for the future?
  • Are the timeframes for the proposals achievable?
  • What’s missing?  Are there other relevant challenges and opportunities that the Government has not addressed?
  • Is the Government’s approach fair for your sector and across different sectors?
  • How does the Discussion Document respond to the Climate Change Commission’s advice?

Please reach out to one of our experts if you have any queries about how the proposals in the Discussion Document might affect you or your business, or if you require any assistance in preparing a submission.

 

Footnotes

[1] Based on GWP100 (global warming potential over 100 years) metric values from the Intergovernmental Panel on Climate Change’s Fifth Assessment Repot (AR5).

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