The net-zero objective is set out in the Zero Carbon Act, which Act has long opposed and wants repealed, but which its coalition partner National has supported.
Act has previously said it wants changes to New Zealand’s targets under the Paris Agreement, or otherwise to leave the agreement.
Act’s climate change policy, released today, also proposes changes to the Emissions Trading Scheme (ETS), including removing the Government’s carbon price floor to allow auctions to clear at a lower price.
“The Government currently sets a minimum auction price for carbon units. In 2026, that minimum was $71 while units were trading on the secondary market in the low $50s. The result has been six failed auctions in a row,” Act says.
“This will increase the supply of carbon credits available through Government auctions and put downward pressure on the carbon price, reducing the costs Kiwis face at the pump, the checkout and on their power bills.”
The net revenue raised through auctions would then be returned to taxpayers through what Act is calling a carbon tax refund. The party doesn’t specify how much this could cost, as the amount could depend on the auction price.
“This will act as an insurance policy for New Zealanders. If the carbon price increases, they will be shielded from its cost-of-living impacts through a larger refund,” Act says.
“If auction revenue becomes so low that delivering individual refunds is impractical, that is good news. It means the carbon price has fallen substantially and Kiwis are already receiving cost-of-living relief through lower prices. In that case, the small amount of revenue would instead be ringfenced to fund other tax relief.”
Act says that, if the carbon price was about $55, the ETS would be imposing an estimated cost of about $478 a year on a household through petrol, electricity and other costs.
The party also has policies it says will protect New Zealand-based factories exposed to foreign competitors who face lower or no carbon prices, discourage farm-to-carbon forestry conversions, and cut red tape to encourage the adoption of new technologies.
“New Zealand’s climate policy is broken and sending the country broke as a result,” leader David Seymour said.
“A small trading nation can’t ignore climate policy, but overdoing it backfires and puts unnecessary costs on Kiwi businesses and households.”
‘Disastrous for New Zealand’s economy,’ – Hipkins
Labour leader Chris Hipkins said the policy “wouldn’t just be disastrous for the environment, it would be disastrous for New Zealand’s economy”.
“Our exporters rely on our clean green brand around the world and access to key markets like the European Union are dependent on New Zealand doing it’s bit when it comes to tackling climate change,” Hipkins said.
The European Union Free-Trade Agreement included a clause on climate change, which commits both parties to upholding agreements to reduce emissions.