On 7 November the Zero Carbon Bill was passed into law. Several changes were made to the final Bill at the recommendation of the Environment Select Committee who reported back on the Bill in late October.

The Zero Carbon Bill addresses climate change and aims to transition New Zealand to a low emission, productive and resilient economy. You can read our previous newsflash on the Bill here.

Key changes made to the Bill prior to it becoming law bolster the authority of the Climate Change Commission, and emphasise that emissions should be offset domestically. We outline these changes along with other points of interest from the Select Committee below.

Key changes

• The purpose of the Bill as a framework to develop and implement New Zealand's climate change policies has been clarified. It now clearly signals that adaptation is a crucial part of our climate change effort.
• The circumstances in which the Commission can recommend changes to the 2050 target and the budgets to achieve that target have been relaxed. In the event of “significant change” to a specific list of climate change factors such as technological development or the scientific understanding of climate change, the Commission has the power to recommend changes to the target. Changes can include the 2050 timeframe, the levels of reductions required, the combination of greenhouse gases and emissions to which the 2050 target of net zero applies and how that target should be met, i.e whether it can include carbon credits from overseas. The Commission now can make these changes if significant change is “likely to occur”, which encourages the Commission to be pro-active rather than reactive. This also allows the Commission to consider the use of forestry offsets and any negative effects this may have on sectors and communities.
• The situations where offshore mitigation may be used have been further restricted. Initially, the Bill allowed for offshore mitigation to be used in limited circumstances in order to give the Government flexibility to transition into a low carbon economy. Offshore mitigation (largely carbon credits purchased overseas) can only be used on the recommendation of the Commissioner if circumstances have changed affecting the ability to reduce emissions domestically. The domestic focus of the emissions budget was emphasised by the Select Committee with the aim that the Minister should only set emission budgets that are able to be met domestically.
• The timeframes for responding to the recommendations made by the Commission have also been shortened. Initially the Minister had up to 12 weeks to present the Commission’s advice to Parliament. This turnaround timeframe has been tightened to 10 working days, or should Parliament not be in session, as soon as possible after the next session. A timeframe was also introduced for making the documents available to the public.
• The Minister's power to request information about climate change adaptation from listed reporting organisations (such as local authorities, Government agencies and lifeline utilities) has been extended to the Commission so it does not need to rely on the Minister's powers to access this information.
• Lastly an interesting addition is the requirement on the Commission to review by 2024 whether to include emissions from international shipping and aviation in the 2050 target.

Other points of note

• Prior to the Select Committee reporting back, there was speculation that the methane reduction target may be removed from the Bill and instead left to be recommended by the Commission. The final Bill has retained the methane reduction target of 10 per cent below 2017 levels by 2030 and between 24 and 47 per cent below 2017 levels by 2050.
• The Select Committee report noted the National party minority view. National has indicated that it will make changes along the lines of those set out below should they win the next election:
  • The target for biological methane would be left to a recommendation by the Commission;
  • Inclusion of a statement that the aim of the Paris Agreement is for greenhouse gas emission reduction in a way that does not threaten food production;
  • Less onerous provisions to ensure New Zealand is in step with the global community;
  • The emission budgets should be split between biogenic methane and carbon dioxide as recommended by the Parliamentary Commissioner for the Environment;
  • There should be a greater commitment to investment in innovation and research and development, to find new solutions for reducing emissions.

Comments

The final version of the Bill sees the Commission’s ability to recommend changes to the 2050 target and emissions budgets extended. The general tightening around how Parliament responds to the Commission's reports is also an improvement on the original Bill. However, the effectiveness of the new law will ultimately depend on the reliability of the information provided by the Commission to Parliament as well as the enforceability of both the target and budgets.

The emphasis on the domestic focus of the Bill has all but ruled out the use of offshore mitigation such as carbon credits. This may mean that over time the cost to offset carbon domestically increases as space for trees becomes more limited. Therefore planting trees is not going to be the only answer; over time our emissions must reduce as well. Other policy documents such as the Government Policy Statement on Land Transport 2018 prioritise reducing emissions from sources such as transport.

The passing of the Bill into law is the initial step in the Government’s move to address and measure climate change, but an important one. The bi-partisan support shown with 119 of the 120 Members of Parliament voting to enact the Bill indicates the importance of this issue. The success will ultimately depend on how the recommendations are adopted, with buy-in needed across the board.