ACT pledges climate policy 'grounded in economic reality,' wants to repeal Zero Carbon Act, says Paris Agreement needs to 'accommodate a fairer approach for NZ'

The ACT Party wants to scrap New Zealand’s net zero emissions target and repeal the Zero Carbon Act as part of its election climate policy.

Net zero has been a long-term target for New Zealand, where all greenhouse gases except methane emissions from waste and agriculture biological processes, are to reach net zero by 2050.

But ACT Party leader David Seymour says: "New Zealand’s climate policy is broken and sending the country broke as a result. A small trading nation can’t ignore climate policy, but overdoing it backfires and puts unnecessary costs on Kiwi businesses and households."

Seymour called the target “arbitrary” and said his party would replace it with “a climate policy grounded in economic reality.”

“We will reduce emissions without deliberately imposing costs on New Zealanders that the countries we trade and compete with are unwilling to bear.”

Releasing its climate policy on Sunday afternoon, ACT outlined that it wanted to: 
- Introduce a "Carbon Tax Refund", returning 100% of net carbon auction revenue to New Zealanders
- Discourage productive farms from being converted into carbon forests and require permanent forest owners to carry the long-term costs and risks of their forests
- Scrap Net Zero and repeal the Zero Carbon Act, instead benchmarking New Zealand’s emissions cap against our major trading partners
- Protect Kiwi jobs where New Zealand businesses face overseas competitors with lower or no carbon costs by restoring carbon assistance where businesses can demonstrate a “genuine competitive disadvantage” against overseas producers
- Cut barriers to cleaner technology and oppose new climate taxes including a tax on agricultural emissions
- Cut the "Carbon Tax" by removing the Government’s artificial minimum price for Emissions Trading Scheme (ETS) auctions and allowing the carbon market to “operate properly”

On wanting to scrap Net Zero

ACT’s policy document says as a country, NZ should play its part. 

“But that is the key: our part. If New Zealand’s trading partners are not demanding the same costly emissions reductions, we should not sacrifice the jobs, wealth and livelihoods of New Zealanders.”

The party wanted to tie NZ’s emissions cap to a trade-weighted average of major trading partners.

“New Zealand should reduce emissions in line with our major trading partners, so we do not deliberately impose costs on ourselves that the countries we trade and compete with are unwilling to bear”, the document says.

‘The Government is not allowing the carbon market to operate properly’

ACT also wants to remove the Government’s auction price floor within its ETS, saying it wants to allow auctions to clear at a lower price.

“This will increase the supply of carbon credits available through Government auctions and put downward pressure on the carbon price, reducing the costs Kiwis face at the pump, the checkout and on their power bills,” the party’s document says.

Seymour says: “Kiwis already pay the price of carbon through higher petrol, power, freight and grocery prices.”

“ACT says that the money the Government makes from selling carbon credits should be given back to households,” he says, calling his party the “OG No New Taxes Party”.

“We’ll return carbon auction revenue to taxpayers rather than giving politicians another pot of money to spend.”

The Paris Agreement

ACT hasn’t shied away from being critical of New Zealand’s involvement in The Paris Agreement. 

Debate was reignited earlier this week over the Paris Agreement with Prime Minister Christopher Luxon saying there’s an economic argument for New Zealand to stay in the Paris Agreement despite pushback from coalition partners ACT and NZ First.

NZ First wants to pull out of the Paris Agreement with leader Winston Peters saying it's “senselessly hamstringing our economy”.

Luxon, who is National Party leader, does not support ACT and NZ First’s attitudes towards the agreement and made it clear while speaking to RNZ that staying in the Paris Agreement is a bottom line in any coalition negotiations after the election.

Under the Paris Agreement, every country sets out its own Nationally Determined Contributions (NDC) - this is to show the contributions countries will make towards delivering on the 2015 Paris Agreement climate goals. The obligations are to limit global warming to “well below 2 °C” and attempt to keep it to 1.5 °C.

Countries can transfer carbon credits earned from reducing greenhouse gas emissions to help other countries meet their climate targets.

ACT’s policy document says this latest policy stood alongside the party’s commitment to “renegotiate a better deal for New Zealand under the Paris Agreement.”

“If Paris will not accommodate a fairer approach for New Zealand, we should be prepared to leave."

‘Our climate policy must be grounded in economic reality’

In its policy document, the party says: “ACT will not kneecap New Zealand’s prosperity for the sake of political virtue signalling. We are not going to impose unnecessary costs on families and businesses so politicians and unelected bureaucrats can boast at international conferences about how ambitious they are.”

The party says New Zealand produces 0.17% of global emissions.

“That means our climate policy must be grounded in economic reality. There is no virtue in making New Zealanders poorer, shutting down productive industries, or sending jobs overseas for changes that make little difference to global emissions.”

“ACT has consistently opposed climate policy that puts political symbolism ahead of New Zealand’s interests,” the document says.