ETS costs still cause conflict

National's bill to amend Labour's emissions trading scheme will pass its first reading in Parliament tonight and be referred to a select committee amid continued quarrelling over which scheme will cost the taxpayer more.

The Government is prepared to go into urgency to ensure it is with the select committee during the coming two-week parliamentary recess.

Climate Change Issues Minister Nick Smith briefed other parties on the bill, which with Maori Party and United Future support will just get over the line at 64 votes to 58 opposed.

In Parliament yesterday Dr Smith said the total cost of changes to the scheme in the period up to 2013 would be $415 million. Costs beyond 2013 were more difficult because the final outcome of international negotiations was not known and there was more uncertainty about the price of carbon.

But Dr Smith said the mid-range estimate by officials was that changes would save $493 million between 2012 and 2018.

"So for the first 10 years of the scheme, the improvements made to it by the Government will save the taxpayer in the order of $100 million."

Labour MP Charles Chauvel asked if was fair that the taxpayer should pick up the bill for changes to the ETS when households received assistance only until 2013 (to limit power price rises), whereas large foreign-owned companies like Methanex, Rio Tinto and BlueScope Steel would receive taxpayer support for another 90 years.

Dr Smith tabled a document using data from the Ministry for the Environment and Rio Tinto showing that such companies would actually receive less taxpayer support - $6 million fewer units up to 2018 at a carbon price of $30 a tonne.

He said the National scheme would make it workable and realistic. On July 1, the Bluff smelter would become the first smelter out of 168 in the world to face a price for its emissions.

- NZ Herald

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