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Feedback welcomed on auction settings for the NZ ETS

Consultation is now open on proposals to amend the auction settings for the New Zealand Emissions Trading Scheme (NZ ETS). The proposals include recent recommendations from the Climate Change Commission. 

The NZ ETS is a key tool in the government’s climate change response toolbox. It supports Aotearoa New Zealand to meet its emissions reduction goals by putting a price on greenhouse gas emissions.

Businesses must surrender a carbon credit – an ‘New Zealand emission unit’ (NZU) – for every tonne of climate pollution they emit. Businesses can purchase NZUs through Government auctions held four times per year. They can also trade NZUs through the secondary market.

The Government makes annual updates to auction limits and price control settings for NZUs. Similar to its advice provided in 2022, the Commission has recommended:

  • Reducing the number of units available for sale at auction each year from 2026 – 2028. This would see a staged reduction of the number of units available.
  • Lifting the auction reserve price each year, starting in 2026. The reserve price is the price below which the Government will not sell units at auction. The Climate Change Commission has recommended lifting the reserve price to $72 in 2026, and gradually increasing this each year to $79 in 2028.
  • Introducing a two-tier cost containment reserve and significantly increasing the trigger price. The cost containment reserve is a supply of NZUs that become available for sale if the auction clearing price meets or exceeds a specified trigger price. The Commission has recommended a low trigger price of $205 in 2026, gradually increasing to $226 by 2028 and a high trigger price of $256 in 2026, gradually increasing to $282 by 2028.

Consultation opened on 19 May and will run for four weeks, ending on 16 June. Public submissions will inform recommendations to the Government for the NZ ETS settings that will apply from 2024.

Submissions and feedback are welcome from anyone with an interest in the NZ ETS.

Following consultation, recommendations for NZ ETS regulation changes will be approved by 30 September 2023. If changes are made to auction settings for 2024, they would not apply until the first NZ ETS auction of 2024.


Participants will have an opportunity to hear more about the proposals and ask questions during webinars. The webinars will be hosted:

  • 11am – 12pm, Wednesday 24 May - register
  • 3.00pm - 4.00pm, Monday 29 May - register

Separately to the regular review of ETS settings, the Government is carrying out a broader review of the Emissions Trading Scheme. More information on this is available here.