The Government of New Zealand announced its intention to ratify the Kyoto Protocol to the UNFCCC at the 2002 World Summit on Sustainable Development (WSSD). Some months before, implementing legislation – the Climate Change Response Bill – was presented before New Zealand’s Parliament. This Bill aimed to:
- Provide for the establishment of the administrative powers and bodies that are required under the Protocol (or that are necessary if New Zealand is to benefit from the compliance mechanism under the Protocol) with a view to allowing for ratification; and
- Formalise the powers and institutions necessary for New Zealand to continue to meet its obligations under the UNFCCC.
The Government of New Zealand also released its Preferred Policy Package, which details the policies that it intends to put in place to respond to climate change and to meet its obligations to reduce greenhouse gas emissions pursuant to the Protocol’s requirements. According to the Preferred Policy Package consultation document, the Government intends that the following measures will be utilised in the pre-commitment period (i.e., before 2008):
- Building on existing “foundation policies”, including the National Energy Efficiency and Conservation Strategy, the New Zealand Transport Strategy, the New Zealand Waste Strategy, Resource Management Act reform, research, and public awareness. These measures are already under way and will proceed whether or not the Protocol comes into force.
- The introduction of Negotiated Greenhouse Agreements (NGAs) for “Competitiveness-at-risk” firms. An NGA is a contract between the Government and a firm or sector to reduce emissions toward an agreed level in return for partial or full exemption from an emissions levy or charge. A particular advantage of NGAs is that an agreed “emissions path” can be tailored to a firm’s individual circumstances. NGAs might also include opportunities for a firm to get involved in off-site projects or emissions trading, if the regime were established, to reduce costs.
- The introduction of Government- and industry-funded research in the agricultural sector.
- The introduction of funding and projects to promote efficient emissions reduction and sinks creation. In this context, projects are specific recognised activities that seek to deliver defined reductions in emissions but which would be uneconomic without the payment of an incentive from the Government. Projects are intended to deliver a reduction in emissions that would not have otherwise occurred.
- The introduction of an emissions charge for carbon dioxide (CO2) approximating the international price for emission units, but capped at $25 per tonne of CO2 equivalent. There will be no charge on emissions of non-CO2 gases during the first commitment period.
- The Government is to retain sink credit assets and liabilities.
Notably, none of the new policies identified in the Preferred Policy Package will be implemented for the first commitment period until the Protocol comes into force. In other words, the new policy measures are specifically designed to deal with the State’s potential Protocol obligations and will only apply once the protocol is effective.
The advantage of this preliminary policy planning is that New Zealand already has in place clearly defined measures to address many of the issues that may have kept some States from ratifying the Protocol. These measures can also be further fine-tuned as time goes on. Through these preliminary measures, New Zealand has mapped out a proactive roadmap that will serve to ease its compliance and implementation process.