KEY POINTS:
We will have an emissions trading scheme regardless of which of the major parties gets to form the next Government.
Both Labour and National accept that to curb greenhouse gas emissions we have to harness the power of prices and markets. The alternatives of relying on regulatory fiat, or free-riding and hoping trading partners won't notice, are liable to prove more costly.
But National has indicated several areas of concern with the ETS legislation passed - without due deliberation in its view - in the last weeks of the parliamentary term. It has said it will "substantially" amend the legislation in its first nine months, if it becomes the Government.
A better balance is needed between environmental and economic considerations, says National, citing in particular the risk of "leakage". That is the risk that too tough a carbon pricing regime will make emissions-intensive industries exposed to international competition - such as steel, cement and aluminium - uncompetitive and drive those activities overseas, costing jobs and export revenues but delivering no benefit to the global environment.
The legislation provides for the allocation of free emissions units to cover 90 per cent of their collective emissions at 2005 levels. National says those provisions need to be "improved", and it opposes the provision to phase out those free allocations between 2019 and 2030. A better deal for emitters would increase the cost to taxpayers.
National says the ETS should not be a money-making scheme for the Government.
Don't worry, it won't be, says Labour, at least until the 2020s.
Even though electricity consumers from 2010 and road users from 2011 will pay the Government for more than their share of national emissions, taxpayers will still pick up the bill for most of NZ's emissions, including the 50 per cent from livestock.
National supports the Government's target of deriving 90 per cent of electricity from renewable sources by 2025, but opposes a ban on building new baseload fossil-fuel generation, preferring to relying on carbon pricing.
It favours allowing "offsetting" where the owners of pre-1990 forests can escape the deforestation liability by planting an equivalent forest somewhere else.
Kyoto Protocol rules do not permit this, though arguably they should, so the cost would fall to the taxpayer unless, or until the international rules are changed.
National's environment spokesman Nick Smith, speaking to the Environmental Defence Society last week, denied that a National-led Government would, at the behest of Federated Farmers, press for ruminant methane emissions to be dropped from any future climate treaty.
