KEY POINTS:
Jim Anderton's overheard conversation with a fellow minister this morning before Helen Clark's presentation on climate change was a fair observation: "If we'd gone too far they [the media] would have said we were draconian."
If the policies announced today were too soft, the Government would have been
condemned for being pointless.
There is a hellishly difficult balance to achieve in the carbon emissions trading system - it has to produce incentives and disincentives strong enough to alter emitters' behaviour, but not so strong that it harms the economy, or makes New Zealand businesses less competitive internationally or that its flow-on effects unduly punish consumers (voters).
Fortunately for the Government, whether the right balance has been struck will not be known for several years.
Today's announcements were the theory. Practice is yet to roll out over the next five years.
Jim Anderton was forced to swallow his pride and give forest owners carbon credits (and liabilities for felling as well) that previously the Government had said it would commandeer.
Anderton was not gracious in his backdown. But it was a backdown which made sense.
It is a shame that that backdown could not have been made a lot sooner to have prevented the deforestation that occurred in recent years.
Forest owners will be allocated a portion of carbon credits - to be formally known as "New Zealand unit" - and they will be then be able to sell their credits to businesses in other sectors who need to units to cover their emissions.
The scheme has managed to win consensus, with support from National and the Greens albeit with more cautious support from the Greens.
Politically the Government has been smart to put a little more flesh on the aspirational goal of carbon neutrality. Clark set out new targets: for the electricity sector to be carbon neutral by 2025; the rest of the stationary energy sector (including gas, coal and geothermal) by 20 30, and the transport sector by 2040.
They are backed up by other sub-targets:
- to have 90 per cent of electricity generated from renewable sources by 2025;
- to reduce by half per capita emissions from transport by 2040;
- to have a net increase in forests of 250,000 acres by 2020; and
- to be one of the first countries to introduce electric vehicles widely;
To some extent, those new targets, and the emissions carbon scheme in totality, will offset the critics who say that the Government's approach to climate change til now just been a lot of hot air.