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Ministers will deliver an implicit message in today’s emissions reduction plan. The market isn’t working, they believe. Businesses and households can’t, or won’t, reduce emissions sufficiently on their own – and so the Government is stepping in with unprecedented levels of climate regulation.
Climate Change Minister James Shaw will announce the all-important plan at midday. He has already admitted that the first of the three emissions budgets will be especially tough to meet.
► That’s partly because the Government failed to heed warnings three months ago that its calculations were outdated, as senior political journalist Marc Daalder explains.
NZ can emit only 290 million tonnes of greenhouse gases between 2022 and 2025 – two million tonnes below the Government's suggested budget last year. The root of the issue is an increase in expected deforestation, expected to release an additional 1.8 million tonnes of carbon dioxide.
The bigger picture, though, is that NZ has simply been moving much too slowly, prompting COP26 analysts last year to name NZ a Fossil Award winner for its failure to update the country's National Determined Contribution to constraining global temperature rises.
All of this will cause business leaders to bridle at the implication, today, that they are to blame for NZ’s slow progress. Successive governments have talked big – most notably Jacinda Ardern dubbing climate change the nuclear-free moment of her generation – but done little.
Newsroom expects further moves towards decarbonising public transport, reducing waste to landfill, clean energy subsidies for industry, and enabling a congestion charge for motorists to enter central Auckland. The plan will describe, at a high level, a regulatory carrot and stick approach to reach a target of net-zero emissions by 2050. Shaw says it’s the first step in a far-reaching reorganisation of the economy and society over the coming 30 years.
Then, in Thursday’s Budget, Finance Minister Grant Robertson will tell taxpayers how the Government intends to pay for these steps.
Until now, ministers have been heavily reliant on the emissions trading scheme to “recycle” revenue into new climate initiatives. But that scheme is now expected to contribute only a share to overall emission reductions.
That may be, in part, an acknowledgement that ministers have failed to win the realpolitik battle to fully introduce agriculture to the trading scheme. The farming partnership He Waka Eke Noa is due to make a final recommendation by May 31 on whether to bring agriculture into the emissions trading scheme or – as the industry prefers – adopt an individual farm-level levy for their relevant emissions. Farmers don’t want to be exposed to the potential for ever-increasing costs for credits from 2025.
Supporters of the trading scheme, like the business-backed NZ Initiative thinktank, the National Party and the Act Party, argue that regulation and subsidies serve only to pervert the outcomes of the market-led trading scheme. They can point to business initiatives like the Sustainable Aviation Fuel Consortium (Air NZ, Scion, Z Energy and LanzaTech) working at a much faster pace than government to develop scaleable alternatives to fossil fuels.
But this is a Labour Government, that has greater faith in regulatory imperatives than in market incentives. So, although the main opposition party National has backed the three emissions budgets, the debate today and in coming months and years will be over the tools to meet those budgets.
NZ can rely on ideas developed and rubberstamped by government – or it can call on the innovation to be found across the entire economy. If the Government is to get buy-in from the wider public, it must choose the latter course.
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1. From our newsroom
// War in Ukraine
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Former minister echoes Russian talking points on Kremlin media
Former government minister Matt Robson has called Nato a “terrorist organisation” and accused Ukraine President Volodymyr Zelensky of “promoting fascists”, in a series of interviews on state-controlled Russian media outlets facing sanctions for spreading propaganda.
Robson, a former Alliance MP and associate foreign affairs minister in Helen Clark’s Labour government, says he is unrepentant and has accused Kiwi politicians of running a “McCarthyist regime” when it comes to Russia.
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Govt set to shake up Auckland rail
It's a green light for big changes as the transport minister adopts new recommendations from an independent report to proactively manage the network's fatigued assets. A report into the Auckland Metro Rail Network describes it as “fragmented” and “disaggregated” with no asset management plan and a passive safety regulator.
Transport Minister Michael Wood has now received eight recommendations from the second and final phase of that report on what could be done to get the system running more smoothly before the City Rail Link opens.
Public transport advocate Matt Lowrie says the opening of the City Rail Link puts a deadline on getting the systemic issues sorted. “Having City Rail Link open and then have to shut the network down would be embarrassing.”
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Missed chance to correct emissions error
Officials may have been aware of an error in the Government's emissions budgets three months before they were publicly forced to correct it.
NZ can emit only 290 million tonnes of greenhouse gases between 2022 and 2025, under the Government's emissions budgets announced last week. That's two million tonnes below the draft budget last year. Documents reveal a missed opportunity to correct the error came in December, when officials briefed Climate Change Minister James Shaw.
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Also on Newsroom.co.nz
Official plans revealed to delay 2023 Census to March 2024
National MP stands by his prediction the census will be delayed.
State sent uplift kids to where ‘sex harm’ man lives
Young children at the centre of a 'reverse uplift' case by Oranga Tamariki were sent to live at a property where a man with sexual behaviour issues was living.
Just relationships up-end ‘stale, pale, male’ decision-making
Stale colonial views have held dominance over our unique systems of government and politics for too long, not reflecting the Tiriti partnership.
By Prof Maria Bargh & Carwyn Jones ● Read more
Chinese techno-nationalism more than mere propaganda
After decades of lagging behind, China’s technological innovation competes on the world stage. It has helped define what Chinese nationalism looks like today.
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Cryptos plunge as market selloff quickens
After another punishing week that saw global stock markets fall for a sixth straight week, markets closed on Friday offering investors a small glimmer of hope that stocks may have bottomed out … for now. The NZX50 cut its losses for the week to 3.8% after being down as much as 5% on Wednesday.
Crypto investors were left reeling after Bitcoin and Ethereum plunged as much as 20 percent this past week following the collapse of a token called luna, sparking new questions over the functioning of the entire crypto market whose combined value has more than halved since November.
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The Detail: What scientists now know about the causes of the Tonga eruption
The eruption of the Hunga Tonga-Hunga Ha'apai volcano in January had scientists scrambling to figure out what caused such a massive explosion. The sonic booms could be heard as far away as New Zealand and Alaska; tsunami waves radiated across the Pacific Ocean.
Once University of Auckland volcanologist Professor Shane Cronin arrived in Tonga and got out on a boat to survey the volcano, and snorkel over the submerged remains, all the initial theories went out the window. Cronin discovered the middle of the volcano's caldera – the large depression formed when a volcano erupts and collapses – was far, far deeper than expected.
Something unique had turbocharged the eruption: the top of this caldera was starting to fracture, allowing in the sea water. "We've got the perfect conditions for our very large explosion."
This has prompted a complete rethink of the science about how underwater volcanoes can cause tsunami. While in Tonga, Cronin has also been helping with tsunami surveying, which will help inform new risk and hazard models across the Pacific.
The above interactive chart is based on a visualisation by Ángel Amores, a physical oceanographer at the Mediterranean Institute for Advanced Studies in Majorca, Spain. The New York Times interactive chart of the planet, created by Aatish Bhatia, Henry Fountain and Sean Cantangui, shows how the shockwaves amplified around the globe over the course of three days.
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Is Lake Onslow pumped hydro a game-changer for NZ’s electricity needs?
In 2002, Earl Bardsley, Honorary Associate Professor at the University of Waikato, came up with the idea of using Lake Onslow in Central Otago to meet the country’s electricity needs during dry years. Now his plan is edging closer to being a reality.
By year’s end, the Government will have decided whether to go ahead with the $4b project that may well turn Bardsley’s vision into reality. The decision to proceed will be based largely on the findings of a feasibility study known as the NZ Battery Project, the outcome of which will be announced next month.
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On Eric Crampton's article, "How inflation gives you a hidden tax hike – and Govt pockets the proceeds":
“Elizabeth Grey
Automatically indexing tax thresholds sounds a much smarter option for the people. But 'for the people' is not in my opinion a government's mandate, though it very much should be.
Prof Peter Davis
While there is an element of truth here, the real question is why we can't have an adult conversation about how we pay for our collective/public goods and for the services we value and take on as a community. It is this that forces our major parties to play ducks and drakes on tax. Just to take three recent examples:
Three Waters: Why are we in a supposedly well-governed, developed and advanced country having to take substantial evasive action to underpin an infrastructure that one might assume to be an absolute basic to a modern, civilised and healthy existence – namely, the basic water infrastructures that our Victorian ancestors initiated and built in the late 19th century? And the simple answer to that is, local democracy. You do not get elected and maintain office in local government by arguing for an increase in rates, and so basic infrastructure is neglected, until it fails. We need an independent structure like the one proposed, or privatisation, or continuing infrastructure failure and periodic central government bail-outs.
Capital Gains Tax: Almost all countries in the OECD have one, and almost all experts agree the lack of one warps investment decisions towards too much going into property rather than productive investment. And it would affect a very small proportion of the population anyway, and mainly those who could most afford to carry it. Yet the PM had to commit to never implementing it. This cannot have been on technical grounds. When the CGT was mooted, it was met by a wall of negativity and pushback from interests vested in the outcome.
National Super: John Key, just like the current PM, had to commit to doing absolutely nothing in the short-term to make National Super financially viable, despite Treasury clearly marking the debt risk and several well-governed countries of our ilk have indeed made the transition from a pay-as-you-go defined benefit system to a pre-funded, contributory alternative.
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Laboured headline - The International Labour Organisation has put NZ on a list of the world's "worst case" breaches of international labour law for its plan for compulsory collective bargaining in the Fair Pay Agreements law. Kirk Hope, chief executive of BusinessNZ, says the ILO is concerned the proposal does not support voluntary bargaining but rather enforces it.
Taking tech global – The Budget will invest $20m over four years in supporting NZ’s $7.4b digital technologies sector growth, says Digital Economy and Communications David Clark. The funding will support the growth of the software-as-a-service community and market the country’s tech and innovation to the world, especially the US, Australia and Europe.
‘Gutted’ with Covid – The Prime Minister has tested positive for Covid-19 and will isolate at home, missing today’s emissions plan announcement and Thursday’s Budget. Jacinda Ardern says she’s “gutted”. Her trip to the US next week depends on whether she remains symptomatic.
Climate-aid blockade – Activist group Extinction Rebellion says it close down the Wiri Petroleum Transfer Station in south Auckland this morning. No petrol tankers will be able to leave the station as activists will block the entrance.
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Quote du jour
“They treated the ladies with disdain the entire way through the process and other survivors I have supported have complained of the same arrogance. Still to this day no apology has been received.”
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// News over here...
House prices now sinking throughout the country with Auckland, Rotorua, Hastings and Wellington leading the way
(Interest.co.nz)
Health worker strike: 10,000 allied workers walk off job
(RNZ)
// And over there...
Lebanon votes in first election since Beirut blast, economic crisis
(France24)
Remote working is making the UK a more equal place – however much Jacob Rees-Mogg may sneer
(The Observer)
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@historymatt in the UK took this picture of a delivery robot lost in the woods. Perhaps it's off to meet the iRobot that escaped from someone's garage last week ... or maybe we don't have to fear the rise of the machines just yet if they can't even deliver parcels.
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Newsroom Daily Quiz
In 1990, who defeated Mike Tyson to become the boxing heavyweight champion of the world?
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