Amendments to the Emissions Trading Scheme (ETS) need to include spending the ETS levy on fuel for projects that help reduce transport emissions, says the NZ Automobile Association (AA).
“Motorists are going to be paying more under the revised scheme for the CO2 they use when driving,” says AA PetrolWatch spokesperson Mark Stockdale.
“The extra tax collected needs to be invested in projects that help reduce the reliance on fossil fuels, such as developing alternative fuels.”
The AA says motorists pay an ETS levy of 6.7cpl on 91 octane petrol and 7.8cpl on diesel at the current price of CO2, which is capped at $25/tonne.
If the price of CO2 rises to the maximum value under the reforms of $35/tonne, this year, that will add another 3cpl, and if it doubles to $50/tonne during 2021-25 then the ETS levy would be 13.5cpl for petrol and 15.6cpl for diesel.
Stockdale says that currently the Government collects about $420m a year in ETS revenue from transport, and that could potentially double under reforms.
But none of that money is dedicated to offsetting CO2 emissions from the transport fleet.
“The objective of the reformed ETS scheme is to reduce CO2 emissions,” says Stockdale.
“The transport sector needs to play its part, but (Government announcements made this week) don’t guarantee that the increased levies will reduce CO2 from transport, which has been the fastest-growing sector for emissions.”
