Government more confident it can stay within its greenhouse gas budgets

The government says it has improved confidence it can stay within its greenhouse gas budgets, despite warnings from the Climate Change Commission.

The commission said in July that all of New Zealand’s climate targets were at risk, and time to get back on track was running out.

Its annual emissions monitoring report said the country’s climate pollution had gradually decreased over time, but progress stalled in 2024.

It singled out the government’s decision to axe agricultural emission pricing and said confidence in the emissions trading scheme – which the government has said is its main tool to drive down greenhouse gases – was “fragile”.

Without new policies to cut climate pollution, both the country’s 2050 net-zero target and emissions ‘budgets’ might not be met, the commission said.

Emissions budgets are the maximum amount of greenhouse gases the country can emit in a five-year time period in order to keep it on track for 2050.

The report also took aim at the government’s emissions projections – saying in some cases they “do not appear to be driven by a realistic assessment of current policy”.

The Ministry for Cities, Environment, Regions and Transport (MCERT) published the government’s response on Tuesday, saying it acknowledged the commission’s recommendations.

The country was on track to meet its current emissions budget, which ends in 2030, with a buffer of 3.6 million tonnes of emissions, the ministry said.

The buffer is about 1.2 percent of the overall emissions budget.

It confirmed the next budget was still off-track by 8.7 million tonnes.

However, since the commission compiled its report, the government had announced new policies “that improve delivery confidence”, MCERT said.

It would continue to monitor risks and work on “strategic options to close the projected emissions gap for the third emissions budget”, which runs from 2031-2035.

After the government decided not to go ahead with a price on agricultural methane, it had committed $437 million to support the development and adoption of technologies that reduce agricultural emissions.

That money appears to be the same $400m investment announced by the government in 2024, which itself was a continuation of a fund set up by the previous government in 2022.

RNZ has asked MCERT to explain how the fund is a new development since the Climate Change Commission compiled its report. The ministry has acknowledged the request.

Since the commission’s assessment period ended on 31 March, the government had announced an additional $51m investment fund to encourage farmers to actually adopt the technologies.

It also announced a new Gas Transition Loan Guarantee Scheme, to help major gas users convert to other fuel types.

Unlike a similar fund under the previous government, the fund is fuel-agnostic – companies can use it to convert from one fossil fuel to another.

Other developments the ministry pointed to include:

A $21m second round of zero-interest loans for public EV chargersA decision to keep the Clean Vehicle Standard, which limits tailpipe emissions of imported vehicles”Emerging evidence” that less food waste is being sent to landfillKeeping emissions trading scheme settings stable to encourage confidence

“We will continue to monitor implementation progress and delivery risks,” the ministry said.

“We will consider corrective action … if risks materialise or the outlook for meeting the current budget changes.”

It was early in the 2026-2030 emissions budget period and the government had confidence it could be met, it said.

“Alongside this, we are progressing work to identify options for closing the projected gap to [the next budget] and supporting achievement of New Zealand’s longer-term climate change targets.”