Climate Change Minister Simon Watts is hailing the partial clearance of New Zealand's emissions trading scheme (NZ ETS) auction as a positive step towards restoring credibility in the market.
According to Mr Watts, the recent government decision to reduce the number of units available at auction between 2025 and 2029 has sent a signal that the government remains committed to using the ETS as its main tool for lowering emissions. This move aims to incentivize individuals and businesses to reduce their emissions and meet climate targets.
At today's auction, 4 million units sold, marking progress in restoring market credibility. The next auction is scheduled for March 19, 2025. While the changes won't take effect until next year, Mr Watts sees this as a crucial step towards sustaining the trajectory of ETS-led emissions reduction efforts.
The government's decision to adjust the number of available units reflects its commitment to getting ETS setting right and delivering effective climate outcomes. As the market continues to move in this direction, it remains to be seen whether these efforts will ultimately succeed in restoring credibility in the NZ ETS.