Bennett considers cancelling dodgy carbon credits

26 April 2016

Climate change Minister Paula Bennett is considering cancelling 122.2 million surplus Kyoto units. It comes amid heightened public attention on New Zealand's climate policy in the wake of a Morgan Foundation report released last week that said the reliance on 'dodgy' Eastern European carbon credits rendered the country "climate cheats".

The credits are estimated to be left over from a total 110 million ERUs bought by the country and participants in its ETS, leaving New Zealand with a surplus of Kyoto units after 372.8 million AAUs, CERs, ERUs and RMUs were surrendered to comply with Kyoto's first compliance period (2008-2012).

The Morgan Foundation report said that even though New Zealand's emissions are rising, it is estimated to have 93.6 million Kyoto units remaining after it retires what it needs to meet its 2020 emissions reduction targets.

Bennett, who signed the Paris Agreement in New York on behalf of New Zealand last week, is currently weighing her options.

"She is taking advice but won't be making any decisions in the next few weeks," a spokesperson for Bennett told Carbon Pulse.

According to UN data, at the end of 2015 New Zealand had unused inventories of 129.2 million AAUs, 13.7 million ERUs, and 202,000 CERs sitting in its Kyoto holding account. 

Voiding the surplus, equal to nearly double New Zealand's annual GHG emissions, might push the government to look for ETS sectors to make deeper cuts in the future to ensure the country meets its targets, as it is barred from purchasing further Kyoto units after declining to renew its membership in the treaty.

The government is already in the process of reviewing the emissions trading scheme and has signalled to the market it wants a higher carbon price to achieve deeper cuts.

Source: Story by Stian Reklev, To read the full story >>