The Government sets emissions budgets to keep New Zealand on track towards the 2050 target. The emissions budgets inform the number of NZUs that can be supplied into the NZ ETS. The emission budgets limit the quantity of emissions that businesses participating in the NZ ETS can emit.
The Climate Change Commission will provide its advice on the first three emissions budgets by May 2021. Before this, the Government has used a provisional emissions budget to help guide the current overall limit and price control settings in the NZ ETS. The provisional emissions budget will be replaced with full emissions budgets, which will be set by the Government before the end of 2021.
Provisional emissions budget for 2021-2025
The Government has agreed a provisional emissions budget for New Zealand’s total volume of net emissions for the period 2021-2025 of 354 million tonnes of carbon dioxide equivalent (Mt CO2-e).