Climate Change Minister Simon Watts. Photo: RNZ / Samuel Rillstone
The government wants to set up a new climate scheme to reward landowners who remove greenhouse gas emissions through projects other than planting trees.
It's already identified new wetlands and rewetted peatlands as "areas of opportunity" to pull more carbon out of the atmosphere.
Climate Change Minister Simon Watts released the new 'Assessment Framework for Carbon Removals' on Tuesday night.
It signalled the coalition's desire to amend the Climate Change Response Act (CCRA) to recognise new carbon removal activities in the Emissions Trading Scheme (ETS).
"Now change that we're proposing won't automatically mean that that will be effective, but it creates an effect, a mechanism for us to be able to in a future point in time, recognise and reward those activities in the ETS which will make it faster and simpler as and when we do that," Climate Change Minister Simon Watts said.
The minister said New Zealand needed to be more "agnostic" about how the country removed carbon, scoping out past just forestry.
"At the moment the market only recognises forestry, particularly exotics and some forms of natives, as the only mechanism that sequesters carbon. We know that scientifically, that's not the case.
"There are other aspects within the broader ecosystem that do sequester carbon, including quite significant areas of opportunity in the blue carbon space in terms of oceans, soil sequestration, wetlands and other considerations like that."
The government was still working out how new methods of carbon removal could be rewarded, Watts said.
"You could recognise or reward sequestration either through the New Zealand Emissions Trading Scheme or thorugh a voluntary carbon market using a biodiversity credit.
"We're not set on this one or the other," he said.
The minister said the framework released this week was "a first step" and he was committed to proceeding with caution, given the range of scientific criteria other countries had adopted.
"We want to make sure that if we do put this in place that it's done so in a credible way."
Changes to the Climate Change Response Act
On top of the carbon removals framework, the government set out a raft of changes it would make to the CCRA.
They include:
- Removing or fixing unnecessary, complex or duplicative requirements in the Climate Change Response Act. This includes removing the need for the Climate Change Commission to provide advice on policy direction prior to an emissions reduction plan being developed by the government and removing duplicative consultation requirements, for both the commission and the government.
- Improving functions of the NZ ETS (amending the Industrial Allocation settings, changing the annual ETS settings process to a biennial one, removing the requirement for ETS Settings to accord with Nationally Determined Contributions)
- Expanding opportunities for other types of carbon removals to be recognised in the NZ ETS in the future.
- Other technical updates to make it easier for stakeholders to comply with the requirements of the CCRA.
Watts said the CCRA had been in place for a while and needed to be changed to "increase the efficiency and reduce the amount of bureaucracy and duplication" embedded in it when it was drafted.
"We now know and have experience across multiple climate ministers and multiple governments of the reality of what this legislation is in terms of operationalising that.
"I think it would be fair to say that a wide range of climate ministers, since the implementation of this bill, would have had a degree of appetite and also identification that there's some aspects within the bill that are not necessarily deriving the intended outcomes of the bill and are unnecessary or duplicative.
"So we are simply using the opportunity to make those changes and clear it up and as a result of that, it creates more capacity within our system and particularly our public system, to focus on the actions required in order to meet our targets and reduce emissions."
The government would introduce an amendment bill to the Climate Change Response Act to make these changes next year.
It's also decided to change the neutrality goal for the Carbon Neutral Government Programme from 2025 to 2050.
"This change acknowledges that the original 2025 deadline was too soon for organisations to reduce their emissions enough to meet carbon neutrality," Watts said
"The new deadline also aligns with New Zealand's broader, legislated 2050 net zero target."
Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
