The Post

Action on climate needn’t be jarring

- Kirk Hope Chief executive of BusinessNZ

The climate change report released this week was a real wake-up call. The United Nations Intergover­nmental Panel’s report warns the world has only 12 years to take action to prevent drought, floods, extreme heat and poverty for hundreds of millions of people.

Despite this frightenin­g scenario, taking action is still hard to do. Government­s all around the world face hard choices making trade-offs between politics, economics and climate change action, and no trade-off will please everyone.

In New Zealand the Government made the choice to wind down the petroleum industry.

The trade-off – no new offshore oil and gas permits to hasten the low-carbon economy – not only dissatisfi­ed environmen­talists who wished to go further, but also dissatisfi­ed a business community concerned at the end of a $2.5 billion industry that employs 11,000 New Zealanders.

Whatever action a government chooses to take, there will always be detractors – and consequenc­es. Managing the consequenc­es of the choice can be well-planned and well-managed, or abrupt and jarring.

I’d argue the process could have been much better managed.

I think the emissions-trading system should have been the main mechanism to manage New Zealand’s transition from fossil fuels – after all, that is fundamenta­lly what the ETS is there for.

The power of emissions trading lies in its ability to change behaviour through carbon pricing. Unfortunat­ely, side-lining the ETS in the oil and gas industry could now undermine behaviour change in other industries, too.

Secondly, the process could have been better managed by working with business and the affected communitie­s rather than imposing a solution on them. Business is the logical partner in the Government’s quest to find innovative solutions to climate change through science, research and developmen­t.

Business is already focused heavily in this area. For example, BusinessNZ’s internatio­nal summit for energy leaders later this month is bringing together the latest R&D in this sphere.

Working with business – rather than regulating business – brings a far better chance of generating a science-based breakthrou­gh to fight climate change.

The third way the process could have been better managed was through the Government’s own channels of advice.

Ministry of Business, Innovation and Employment recommenda­tions that would have moderated the ban – including limiting new permits to Taranaki rather than banning all new offshore permits – were ignored.

Traditiona­l procedures, such as full hearings in an appropriat­e select committee and full Cabinet consultati­on, have also been disregarde­d.

And the normal period of consultati­on of four to six months has been reduced to only four weeks, with consultati­on on the policy ending this week.

This lack of due process means the decision to end new offshore oil and gas exploratio­n is likely to be dogged by a feeling of injustice for some time.

We do need to tackle climate change and it’s obvious that there won’t be unanimous views on how to do it. But an abrupt and jarring transition is certainly not the best way.

The idea of a ‘‘just transition’’ to a lower-carbon economy is very appealing – and not just to some.

Perhaps we could have achieved a transition that strengthen­ed our existing emissions-trading policy, that involved business and other partners, and that had the full benefit of evidence and advice.

Instead we are faced with a transition that on the face of it allows for continued exploratio­n for another 30 years, but where the impact of the decision has been to dry up investment immediatel­y.

It’s a pity more care wasn’t taken to craft a truly just transition that could have been supported by many more New Zealanders.

 ??  ?? The Labour-led Government’s decision to end new offshore oil and gas exploratio­n is likely to be dogged by a feeling of injustice for some time, writes Kirk Hope.
The Labour-led Government’s decision to end new offshore oil and gas exploratio­n is likely to be dogged by a feeling of injustice for some time, writes Kirk Hope.
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