Many of the definitions have been sourced from the GHG Protocol Initiative’s glossary, which can be found at:

Assigned amount units (AAUs):
The emission units allocated to the Annex I (industrialised) countries under the Kyoto Protocol on the basis of their quantified emission target for the first commitment period, 2008-2012. One AAU is equal to one tonne of carbon dioxide equivalent.
Clean development mechanism (CDM):
A Kyoto Protocol mechanism that allows emission reduction and afforestation/reforestation projects with sustainable development benefits to be implemented in developing countries that have ratified the Kyoto Protocol. CDM projects earn particular Kyoto units that can be used by an Annex I Party such as New Zealand to help meet its Kyoto commitment.
Carbon dioxide equivalent (CO2e):
The quantity of a given greenhouse gas multiplied by its global warming potential, which equates its global warming impact relative to carbon dioxide (CO2). This is the standard unit for comparing the degree of warming which can be caused by emissions of different greenhouse gases.
Carbon tax
A tax applied to CO2-equivalent emissions of certain major greenhouse gases. The government’s 2002 climate change policy package included a carbon tax on energy, industrial and transport emissions, capped at $25 per tonne of carbon dioxide equivalent (CO2e). In December 2005, the government decided not to proceed with the announced carbon tax.
Competitiveness-at-risk (CAR):
Being in the position where bearing a price for greenhouse gas emissions significantly impedes a firm’s ability to compete against international competitors in countries with less stringent climate change policies. Such competition could be on the basis of exports or imports.
Commitment period:
A range of years within which Parties to the Kyoto Protocol are required to meet their greenhouse gas emissions target, which is averaged over the years of the commitment period. The first commitment period is 2008-2012. The targets are set relative to greenhouse gas emissions in the base year (in New Zealand’s case, 1990), multiplied by five.
Economic leakage:
Economic activity being displaced from one country to another, with consequent reduction in economic welfare in the former country.
The intentional and unintentional release of greenhouse gases into the atmosphere.
Emission factor
An intensity factor relating greenhouse gas emissions per unit of activity (such as tonnes of fuel consumed, tonnes of product produced).
Emission unit or allowance:
A tradable unit representing the right to emit one tonne of CO2 equivalent emissions. See the Climate Change Response Act for a legal definition of emission units in the New Zealand context.
Emissions (or environmental) leakage:
The shift in emissions (and other environmental impacts) from one country to another associated with economic activity being displaced from one country to another. If reduced production (and emissions) in one country results in increased production (and emissions) in a competing country, then there is no global emissions benefit.
A waiver from bearing an obligation under a policy measure. For example, under the former carbon tax and NGA regime, NGA firms were to receive a full or partial exemption from the carbon tax that would otherwise have applied to their direct emissions of greenhouse gases.
Fossil fuel:
Coal, natural gas, crude oil and fuels derived from crude oil such as petrol and diesel. They are called fossil fuels because they have been formed over long periods of time from ancient organic matter. They are not renewable.
Global warming potential (GWP):
A factor describing the radiative forcing impact (amount of warming) of one unit of a given greenhouse gas relative to one unit of CO2. For example, under the Kyoto Protocol, the GWP of methane is 21.
Greenhouse gas (GHG):
Greenhouse gases are constituents of the atmosphere, both natural and anthropogenic, that absorb and re-emit infrared radiation. Greenhouse gas emissions covered by the emissions limitation or reduction commitment for the first commitment period of the Kyoto Protocol are carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulphur hexafluoride (SF6).
A list of an organisation’s or a country’s greenhouse gas emissions by sources, removals by sinks, and stocks.
Joint implementation (JI):
A mechanism that allows emission reduction and removal projects to be implemented in Annex I Parties that have ratified the Kyoto Protocol. JI projects earn particular Kyoto compliance units known as Emission Reduction Units that can be used by an Annex I Party to help meet its Kyoto commitment.
Kyoto Protocol:
A protocol to the United Nations Framework Convention on Climate Change that requires ratifying countries listed in its Annex B (industrialised nations) to meet greenhouse gas reduction targets during the period from 2008 to 2012 (see for further information).
Any action that results, by design, in the reduction of greenhouse gas emissions by sources or removals by sinks. Mitigation and abatement are considered equivalent terms in the context of this paper.
National inventory:
A quantitative report of anthropogenic emissions by sources, removals by sinks, and stocks of greenhouse gases not controlled by the Montreal Protocol.
Negotiated Greenhouse Agreements (NGAs):
Under the government’s 2002 climate change policy package, NGAs were available to eligible firms whose international competitiveness would be placed at risk by the carbon tax. Eligible firms were to receive full or partial relief from the carbon tax in return for moving toward world’s best practice in greenhouse gas emissions management. In December 2005, the government decided not proceed with the carbon tax/NGA regime.
In this paper, the increase in the consumer price of a product resulting from the imposition on the producer or supplier of a price for the product’s greenhouse gas emissions.
Price-based measures:
Also referred to as “economic instruments” and “market instruments”, price-based measures can be applied to integrate the costs (or opportunity costs) of greenhouse gas emissions into decision making in the marketplace, thereby influencing choices in production, consumption, and technology development. They can include pollution charges and tradable resource and pollution systems. The goals of such measures include achieving efficiency in environmental and energy policy through compliance cost minimisation, overcoming barriers of asymmetric information and encouraging technological change. The term “price-based measures” is applied most commonly to greenhouse gas charges and emissions trading, but can also include other forms of financial incentives.
An amount intended to refund the cost of a policy measure. For example, under the former carbon tax/NGA regime, rebates were available to NGA firms to compensate them for increased electricity prices resulting from the carbon tax applied to fossil fuels.
Exemptions and rebates designed to offset the cost of a policy measure, such as a tax or other charge.
Revenue recycling:
The return to the economy of revenue derived from a policy measure.
The uptake and storage of carbon. Carbon can be sequestered by plants and soil and in underground/deep sea reservoirs. (Underground storage is also called geological sequestration.)
A sink actively removes a greenhouse gas from the atmosphere, such as a growing forest or soil. A sink is distinct from a place where greenhouse gases can be stored ("sequestered"), such as an underground reservoir or a mature forest.
Criteria that define which firms, sites, or other business units are required to participate in a policy measure.
United Nations Framework Convention on Climate Change negotiated in 1992. It aims to stabilise greenhouse gas concentrations at a level that avoids dangerous human interference with the climate system.

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