Government response to the New Zealand Productivity Commission Low Emissions Economy report

The New Zealand Productivity Commission provided recommendations to the Government on how to transition New Zealand towards a lower emissions future.

About the Low Emissions Economy report

In 2017 the Government asked the New Zealand Productivity Commission (commission) to identify options for how New Zealand could reduce its greenhouse gas emissions while continuing to grow incomes and wellbeing. The commission provided 77 recommendations in its final report in August 2018.

The overall finding is that the transition to a low emissions economy is achievable, but will be challenging. Concerted effort is required across many areas.

The commission recognised that in order to transition to a low emissions economy it would be important to do the following.

  • Establish a comprehensive and durable legal and institutional framework.
  • Reform the New Zealand Emissions Trading Scheme.
  • Avoid locking in emissions by supporting smart lower emissions choices in our investments in long term assets such as infrastructure, buildings, our vehicle fleet, and in planning our urban areas.
  • Invest in research and development now to allow for the innovative and creative solutions that are needed to create and deploy new and existing technologies in a way that can also improve the economy and national wellbeing.
  • Alongside emissions pricing, act now on low-cost abatement options. The commission recognised opportunities for this in sectors such as transport and process heat.

Next steps

Of the 77 recommendations from the commission, the Government agrees with, or agrees to investigate, the majority. Much of the work needed for a successful transition to a low emissions economy is already underway, though early progress and ongoing commitment is essential.

The Government will continue to drive momentum on its whole of economy climate change work programme through the Climate Chief Executive’s Board. It will monitor and drive the progress of each agreed recommendation in its response and report developments to the Minister for Climate Change.

The chair of the Climate Chief Executive’s Board is Vicky Robertson, Secretary for the Environment and Chief Executive of the Ministry for the Environment. The other chief executives are from the Treasury, Ministry of Transport, Ministry for Business, Innovation and Employment, Ministry for Primary Industries, the Energy, Efficiency and Conservation Authority and the Ministry for Foreign Affairs and Trade.