The Greens have won some very good improvements to the ETS in exchange for their support.
The most important is $1 billion over 15 years to insulate low-income homes and subsidise upgrades to insulation of higher income homes. That’s a really positive development; all New Zealand homes will finally have decent insulation (Labour has done well in insulating State houses; it’s the private landlords who, up to now, have failed). Better insulation allows families to reduce their heating bills and, thereby, their carbon emissions but it also creates warmer, dryer houses, which leads to better health, especially for children and this, in turn, leads to better educational outcomes.
A contestable fund of 150,000 carbon credits a year for developing low-carbon technologies will accelerate development of these technologies and keep New Zealand companies at the forefront in producing products for which their is growing international demand.
Parliamentary oversight of the allocation of permits and the requirement for the Minister to announce targets for carbon reduction will help ensure that real reductions are made, that the cap is lowered aggressively, and that allocation of credits is transparent.
The Greens have played a bit of brinkmanship with Labour over the ETS and it has paid off. They have led the debate towards a greater focus on sustainability; delivering a more environmentally effective ETS than would otherwise have been the case.