Chauvel Charles: Estimates Debate — In Committee 
Chauvel Charles: Estimates Debate — In Committee 
[Volume:656;Page:5579] 
CHARLES CHAUVEL (Labour) 
: 
 I was disappointed by that contribution from Nicky Wagner because she sits on the Emissions Trading Scheme Review Committee and has made a thoughtful contribution on that committee. I was hoping we would hear from her today some further reflection on the work of the committee the design of the scheme and the question of targets. Instead we heard her read out a speech written by a research unit. That really is disappointing in this debate. 
In this brief contribution I will say that people are growing tired of the delay we have experienced in getting finality in this vital area of policy. We need to take it seriously. In my view there has been too much misleading talk about the balance between economic and environmental considerations. I think we are coming to a head when we come to the question of what carbon pollution reduction targets have to be set. It is embarrassing that we are one of the last developed countries to do this and it is just another indication of the risk we face in falling behind the rest of the world. Looking at the countries we like to compare ourselves with we see that President Obama has announced his Green New Deal with a major emphasis on how the US will transition to clean energy; in the United Kingdom Ed Miliband the Secretary of State for Energy and Climate Change has announced major reforms of the electricity sector in order to encourage investment in renewable energy resources; and our nearest neighbour Australia has developed the $4.5 billion Clean Energy Initiative to provide investment in the development of low-pollution technologies. The rest of the world is doing something. It was interesting to hear the previous speaker talk about the need to avoid a longer delay. We do not need to be in delay mode; we need to get on with it. We need to make sure that the actions we take will be beneficial. There is just too much at stake not to do so. 
Let us talk about the targets Nicky Wagner mentioned. The figures that have come out as far as Government studies are concerned—the analysis from the New Zealand Institute of Economic Research and Infometrics—are misleading. We need to have a good look at them. The studies cite a carbon price of $200 a tonne which is completely out of touch with international consensus. The price of carbon internationally in the medium range is much more likely to be about half that amount at $100 a tonne. The suggestion that there will be a price of $3000 per household per year is grossly inflated. If we look at the assumptions in the report we see that it is much more likely that if we adopt a target of zero then there will be about $1000 cost if there is a 15 percent reduction then the cost per New Zealander will be more like $1350 and for a 40 percent reduction there will be around $1900 cost which is 36 percent lower than the figure in the analysis that has been released. 
The modelling also assumes a lack of international competition in the carbon market. This is a major omission. It assumes no forestry planting which would result from the gradual increase in carbon prices. The US$25-a-tonne modelling by the Greenhouse Policy Coalition shows that forestry plantings would provide for 9 million tonnes after 10 years. This would make a huge different to meeting our target. Why not be bold? Why not look at the sorts of targets that are being advocated overseas in jurisdictions we like to compare ourselves with? I ask why we are instead mucking around with numbers that will not make a difference in the long run and that certainly will not get us to a satisfactory level of reduction by 2050 which everybody agrees we need to do. 
It is interesting to think about the hiatus that we are in. Nick Main the chairman of the New Zealand Business Council for Sustainable Development told the Emissions Trading Scheme Review Committee that indecision in this area is costing huge amounts of forgone investment. He said: “investment blight was affecting hundreds of millions worth of … investments in forestry clean energy and biotech and also holding up decisions on reinvestment and new investment in emission intensive industries”. 
The time to be bold is now. It is the time to show leadership. That is what New Zealanders want from the Government. We really need to see that leadership and we need to see it from the Minister for Climate Change Issues in respect of targets. 
Debate interrupted.