A new scrap-and-replace scheme to help low- and middle-income New Zealanders buy electric vehicles and a nationalized curbside waste collection service is part of a major $2.9 billion investment dollars in New Zealand’s fight against climate change and reducing emissions.
In addition, the emissions reduction plan announced as part of the 2022 budget injected $650 million into the decarbonization of the energy sector and industry and $710 million to reduce agricultural emissions. A total of $1.2 billion will go to transportation.
Finance Minister Grant Robertson said we must prepare for climate change now – or prepare to pay the cost of inaction for the “rest of our lives, the rest of our children’s lives and the lives of their children”.
“Today is the most important day in the history of our country when it comes to climate. I hope the days when climate was political football come to an end.”
Robertson called emissions reduction policies “not drastic – they are essential”.
He said today’s plan would ensure New Zealand was on the right side of history.
Climate Change Minister James Shaw said it “is going to take all of us and it’s going to take everything we’ve got”.
Disposal test for replacement
Transport Minister Michael Wood said that for many families “the cost of switching to cleaner vehicles may be too high”, even with the existing clean car rebate scheme.
An initial trial of up to 2,500 vehicles, the new clean car upgrade program will help low- and middle-income people buy low-emission alternatives in exchange for scrapping their old car. It will begin early next year with around $30 million in the trial, with the full program expected to be operational by 2024/25, costing around $570 million over four years.
He said a similar program in California saw 10,000 “dirty old cars” taken off the road and replaced with new and used zero-emission or hybrid vehicles.
There will also be a $20 million “social rental trial” for low-income families in three communities to rent electric vehicles from a community organization starting in early 2023.
A total of $1.2 billion will go from the Climate Emergency Response Fund “to help people move to public transit, increase walking and cycling, accelerate adoption of cleaner vehicles … and to decarbonize our freight system”.
“This is expected to reduce carbon emissions equivalent to taking 181,000 cars off the road by 2035.
The transport minister said he was considering capping the cost of the car at $35,000 and offering a $10,000 subsidy to allow people to buy an electric or hybrid vehicle.
Wood said there was a final policy design to be made over the next two months, but the threshold was expected to be approximately median household income.
To reduce waste emissions, the government wants to reduce and divert organic waste from landfills.
Most New Zealanders should have access to a food waste collection service by 2030. At the same time, the government will invest in waste management infrastructure, such as composting.
All municipal landfills must be equipped with gas capture systems by 2026.
It will cost $103 million over four years, with the biggest investments from 2022 to 2024.
Climate change financing
Finance Minister Grant Robertson said the $2.9 billion allocation over four years was aimed at moving New Zealand away from “short-term piecemeal responses” and towards long-term investments.
It is estimated that there will be an additional $1.5 billion invested in climate change in future budgets through revenue generated by the emissions trading system.
This could mean New Zealand could hit its first carbon budget; a limit announced last week.
The limits are part of the effort to bring New Zealand to net zero greenhouse gas emissions by 2050
Between 2022 and 2025, New Zealand must reduce its emissions by 11.5 megatonnes of carbon dioxide equivalent, roughly equivalent to the emissions of five million petrol cars that travel 10,000 km per year.
There will be $1.2 billion for transportation, part of which is to continue the clean car rebate, improve electric vehicle charging stations and have a zero-emission bus fleet by 2035.
There will be integrated nationwide public transport ticketing, with new projects in Auckland, Wellington and Christchurch to create easier, cleaner and cheaper public transport.
Energy Minister Megan Woods said rising global prices meant New Zealand had to “wean itself off” expensive fossil fuels and make the energy system future-proof.
“Emissions from our energy and industry sectors represent 27% of our total emissions,” Woods said.
The government is increasing funding for businesses to “shift to cleaner, more affordable and more efficient energy choices,” Shaw said.
Woods said the funding will be around $650 million over four years “which means we can increase the number and type of projects that receive money.”
New low- and medium-temperature coal-fired boilers will be banned and existing ones will be phased out by 2037.
Stricter insulation standards for new buildings “so that new buildings are warmer and drier while requiring 40% less energy for heating”.
He said New Zealand would be one of the world’s most sustainable food providers by introducing a price on agricultural emissions from 2025 and “working alongside farmers with advice and technology”.
$710 million over four years will be used to accelerate efforts to reduce agricultural emissions, increase the amount of carbon reduced by forestry and produce “green” fuels.
“Our economic security depends on New Zealand’s food and fiber sector,” said Agriculture Minister Damien O’Connor. “It’s our biggest source of export revenue, but also our biggest contributor to emissions, and if we don’t act now, we’ll be at risk as consumer preferences change.”
“We are allocating nearly $339 million to accelerate the development of high-impact technologies and practices to reduce agricultural greenhouse gas emissions, including the creation of the new Climate Action Center on Agricultural Emissions.”
$73.5 million will go to “increasing woody biomass, which provides the best alternative to coal in our efforts to reduce carbon emissions from fossil fuels,” Forestry Minister Stuart Nash said.
He will see around 10,000 ha of forest planted.
“Forests can provide an abundant natural resource to store carbon. Funding of $256 million will be used to maximize forestry’s contribution to increasing carbon sequestration to meet New Zealand’s future carbon targets .”
In a statement, Prime Minister Jacinda Ardern described the release of the emissions reduction plan as a milestone day in New Zealand’s drive towards low emissions.
“We cannot leave the issue of climate change until it is too late to address it,” she said.
Ardern also said tackling climate change “means we can bring down the cost of living.”
“Reducing our dependence on fossil fuels will protect households from the volatility of international price increases while reducing transportation and energy bills. Households are already seeing the impact of escalating oil prices and this plan defines practical ways to reduce electricity, transport and energy.”
Shaw said it was a historic day for climate action in Aotearoa.
He said New Zealand was on track “to bend its emissions curve downwards for the first time in history”.
“The plan we released today sets the stage for a net zero future where more people can buy electric vehicles, our cities have state-of-the-art public and active transportation infrastructure, our largest emitters have moved to a clean, reliable energy, our farmers are growing food in ways that help the climate, and more of our homes are warmer and more affordable to heat.”
ACT’s David Seymour called the announcement “a boon for bureaucrats and a travesty for taxpayers”.
“The government has chosen the most costly and bureaucratic path possible to reduce emissions. It has maximized political theater while actively rejecting the least costly path to reducing emissions during a cost of living crisis.”
Climate Change Commission Chairman Rod Carr said a good emissions plan would show “urgency, determination, cohesion and a commitment to collaboration”.
“The transition will impact some communities, industries and regions more than others. The government must work with those most affected to ensure that the transition is feasible, affordable and socially acceptable.
Andrew Hoggard of Federated Farmers said he was “pleased that the government has recognized that the solutions to agricultural emissions lie in new technologies and tools, and are stepping up investment on this front”.
“Nitrate and methane inhibitors, gene editing, animals bred for their low methane ‘rotation’ – these are the kinds of advances that will keep New Zealand’s agricultural sector running for the future. national economy while maintaining our world leading meat and dairy carbon footprint,” he said.
While Greenpeace said the plan failed “by omission of dairy pollution”.
Leading farm campaigner Christine Rose said it was “absolutely staggering that the emissions reduction plan did not include a policy that would reduce cow numbers or phase out emissions-causing synthetic nitrogen fertilisers”.
“This emissions reduction plan is not credible because it does not address the dirty fat cow in the room.
“Instead of simply reducing cow numbers, the government is relying on industry promises, hypothetical and unproven technological solutions to agricultural emissions and fresh water reforms that the dairy industry is undermining. at each step.”