Opinion: Without the feebate scheme – which was mildly ambitious at best – the Government has virtually no policy on cutting transport emissions, Marc Daalder writes
Jacinda Ardern launched her campaign in 2017 with the claim that climate change was “my generation’s nuclear-free moment.”
It was always an ambitious piece of rhethoric and now, after two-and-a-half years of retreat after retreat on climate policy, the promise seems a good PR line and little more.
Then-Labour Prime Minister David Lange banned ship visits by our key military and trading partner in a way that was politically and diplomatically painful for a decade. If this Government had been in charge in 1985 when the USS Buchanan came knocking, the United States may have received an official protest letter at the docks, along with tea, biscuits and invites for more visits.
On Friday, Stuff reported that the Government had abandoned its feebate scheme – its only policy dedicated to reducing transport emissions – which would have seen fees of up to $3,000 on high-emitting vehicles to subsidise the purchase of electric vehicles by up to $8,000. It would have cost the Government little cash up front, but only reduced emissions by around 1.6 million tonnes of CO2 equivalent over twenty years, according to a Ministry of Transport analysis. New Zealand emits around 80 million tonnes of greenhouse gases a year – well above where we need to be to meet our international commitments.
Although Ardern argued on Monday that “as far as I’m concerned, it’s a policy we’re still working on”, New Zealand First, on Twitter, claimed credit for sinking the proposal. Green Party co-leader James Shaw also confirmed to Stuff that the scheme had been scrapped, but the Greens now say the policy has just been “held up”.
But with both NZ First and National crowing over having slain the scheme, it’s hard to imagine the feebate scheme making it through Parliament with 61 votes. This insistence that the policy is still drawing breath is reminiscent of the Monty Python sketch in which a pet store salesman assures an irate customer that his newly-purchased and deceased parrot is, in fact, “just restin’”.
Government has no transport emissions policy
Without the feebate scheme, which the Government repeatedly pointed to when criticised over its lack of initiative on climate change, there is essentially no extant policy on cutting transport emissions. Transport is responsible for a fifth of New Zealand’s annual emissions and its the fastest growing sector in terms of gross emissions, but all the Government has left to deal with it is the Emissions Trading Scheme.
Since coming to power, the Government has considered and scrapped a number of ambitious proposals to cut transport emissions. Perhaps the most daring of these was a plan to ban the import of fossil fuel vehicles after 2035.
A Transport analysis found this would have a net $2.26 billion benefit and would have averted 27 million tonnes of CO2e over thirty years. It also staked a middle ground in choosing the 2035 deadline, when France, the UK, Scotland, Norway, Holland and Germany have all called for new cars to be emission-free or low emission by dates varying from 2025 to 2040.
Earlier this year, Boris Johnson moved the UK’s deadline to 2035 from 2040 and pledged to move it even earlier if possible. Meanwhile, Jacinda Ardern was unable to wrangle a similar policy through Cabinet to respond to this generation’s “nuclear-free moment.”
Even less ambitious policies have been halted. A proposal to charge higher vehicle licensing fees on high-emitting vehicles failed to make it through Cabinet and a possible programme for scrapping older, unsafe and high-emitting cars hasn’t been heard from since October.
Just 82 electric cars
In its attempts to lead by example, Labour’s coalition agreement with NZ First committed the Government to making its entire vehicle fleet emissions-free by mid-2025. That was quietly abandoned and the Government has now just bound itself to making all vehicles entering its fleet after mid-2025 emissions-free.
Out of 15,766 vehicles the Government owns, just 82 of them are electric. Another 754 are hybrid. Since the last quarter, the fleet has added four electric vehicles, 240 hybrids and 49 fossil fuel vehicles.
Even the most milquetoast of proposals failed to see the light of day. In early 2019, the Government considered an exemption from Fringe Benefit Tax for electric vehicles, which would incentivise businesses to buy them as company cars. This would help high-quality electric vehicles filter into the personal used car market, since companies turnover vehicles every three years, on average.
Nonetheless, a negative Treasury report to Revenue Minister Stuart Nash appears to have sunk that proposal, even as FBT exemptions remain in place for high-emitting double cab utes like the Ford Ranger.
What the Government did manage to scrape together enough political capital to accomplish was the recently-announced $5.3 billion investment in new roads, which experts say could lock in tens of millions of tonnes of emissions for years to come.
So: no feebate scheme; no deadline on importing fossil fuel vehicles; no using the Government’s purchasing power to incentivise EV uptake; no scrappage scheme or even FBT exemptions. What’s left? Besides a bit more interest in investing in public transport and cycle lanes, all the Government has to offer is Road User Charge exemptions for electric vehicles, $6 million a year for charging stations and crossing their fingers and hoping that the ETS saves them.
ETS alone isn’t enough
But it won’t. The ETS alone is too blunt a tool to affect the sort of change New Zealand needs to see on transport emissions if it wants to meet its international commitments and domestic pledge of net zero carbon emissions by 2050.
“The ETS has been in place for a long time and New Zealand’s emissions keep rising, and transport emissions fastest of all so clearly it has proven to be pretty ineffective in that space,” Amanda Larsson, a climate campaigner with Greenpeace New Zealand, told Newsroom.
David Tong, WWF New Zealand’s climate change programme manager, agrees that the ETS alone is not enough. “Even under the proposed changes currently being consulted on, the ETS will have extensive free allocations out to beyond 2050. It’s not going to really put a price on carbon to encourage uptake of electric vehicles or low carbon transport,” he said.
A 2017 report from Infometrics, commissioned by the Ministry of Transport, showed that transport emissions would only fall by 11 percent by 2030 if the carbon price was as high as $100. “Significantly greater reductions are needed if the transport sector is to make a contribution to our 2030 Paris target and 2050 target of having net zero carbon emissions,” Glen-Marie Burns, manager for Environment, Emissions and Adaptation at the Ministry of Transport, told Newsroom in January.
“A price signal in the ETS is an important measure, but we need more than that,” Tong said. “We need to use a whole suite of tools to encourage innovation, to encourage lowering carbon choices. Particularly with transport emissions, the price paid in the ETS, by and large what you’re paying is at the pump.”
“That’s not when you buy the car. Low-income families are then going to have to pay the extra cost with future ETS price increases down the line,” because they can’t afford to purchase an expensive EV up-front.
“The ETS is a blunt tool and it is also not a tool that will on its own enable a just transition.”
When Newsroom reported Treasury had argued against the feebate scheme in favour of letting the ETS do the heavy lifting, Associate Minister for Transport Julie Anne Genter said: “The Emissions Trading Scheme is an existing tool to reduce emissions, however, despite being in place for over a decade our transport emissions keep rising”.
“The [feebate] policy works with our ETS to strengthen the Government’s work to reduce transport emissions.”
Burns agreed. “The key supply barrier is that a relatively less fuel efficient selection of vehicles is made available to our vehicle market compared to other countries’ markets. The ETS cannot address this barrier as the decisions of overseas vehicle suppliers are unlikely to be influenced by New Zealand’s carbon price.”
What a nuclear-free moment would look like
So, if abandoning any policy that would specifically tackle transport emissions was not the appropriate response to this generation’s nuclear-free moment, what would be?
“When we look at New Zealand’s decision to go nuclear-free, what we saw was a visionary statement – which we’ve heard from our current Prime Minister on climate – and then bold, visionary action to enact that statement. Barring US ship visits effective immediately,” Tong said.
“What we don’t have yet on climate is that bold, visionary action to follow up – with a couple of exceptions: the ban on new offshore oil and gas was a bold, visionary move, parts of the Zero Carbon Act are bold and visionary. We need that kind of vision throughout.”
“A bold, visionary move would be setting an end-date for when petrol cars can be sold in New Zealand. It would be saying, we have a vision, for example, of knocking off 75 percent of our transport emissions by 2030. It would be bold and it would be possible.”
“Reforming New Zealand’s transport system away from the car-based model is a pretty big undertaking. It’s going to require multiple interventions – it’s not about one policy that will fix all. But, it is the key priority – alongside transitioning the agricultural system – in terms of meeting our emissions reductions targets,” Larsson said.
“The first principle is that the balance of public spending should be weighted towards decarbonisation. We should have seen the opposite of what we saw in that infrastructure announcement, with the bulk of spending going on public transport, cycling, walking, rail infrastructure, rather than about a sixth of it.”
A real emergency response?
In terms of specific policies, there are a plethora to choose from. Larsson highlights the possibility of committing ten percent of transport funding to walking and cycling, requiring new buses to be fully electric from 2025, the Government’s proposed scrappage scheme and a legislated end-date for the import of fossil fuel vehicles.
“The Productivity Commission has said all new vehicles entering the fleet need to be electric by 2030, so to me, that sends a really obvious message about what needs to be done: end all imports of diesel and petrol light vehicles by 2030,” she said.
Lowering transport emissions will also require changes in the ways we live, Larsson says. “In New Zealand, there’s a bit of cultural resistance around how a lot of people – even city-dwellers – rely on cars to get out of the city, go to the beach, or go hiking. A lot of people can’t visualise living without a car for that reason.”
The solution is a widespread network of electric vehicles available for car sharing, “available in different vehicle sizes and functions as well,” Larsson said.
These are all bold, visionary proposals. If most, or even many, of them were implemented, they would represent a sea change in the course New Zealand is charting on climate policy. This would be in line with the call from United Nations Secretary General António Guterres for “the social and economic transformation needed to achieve our 2030 goals”.
Instead, we’ll close our eyes and hope the ETS is enough, now that the feebate scheme is dead. Sorry – now that the feebate scheme is just restin’.