Green Party suggests that Productivity Commission investigate carbon intensity

The Green Party has suggested a Productivity Commission inquiry into how New Zealand can best raise living standards while simultaneously reducing net greenhouse gas emissions.

“Measuring carbon intensity and agreeing on ways to reduce it can help New Zealand support a good standard of living while also reducing greenhouse gas emissions to help prevent climate change,” said Green Party Co-leader Russel Norman.

Carbon intensity is a measurement of how efficiently greenhouse gas-emitting resources are used. It is commonly expressed as the ratio of net greenhouse gas emissions to real gross domestic product.

“In a carbon constrained world, carbon intensity is a key measure of an economy’s productivity,” Dr Norman said.

“If New Zealand is to be a high-performing clean economy, we need a very low level of carbon intensity. We want our firms and industries to be highly productive while emitting very small amounts of greenhouse gases.

“Data provided by the Parliamentary Library shows that carbon intensity is increasing, except for a small dip at the time of the global financial crisis. However, the Government is not taking carbon intensity seriously, with Climate Change Minister Tim Groser saying that New Zealand’s carbon intensity has reduced since 1990.

“We want New Zealand to be safeguarded against future carbon price shocks. If we have high carbon intensity then our economy is more vulnerable to the international price of carbon.

“Carbon intensity should not be the only way we measure our response to climate change, because the climate system only responds to actual net emissions. But it is nonetheless an important measurement in the context of productivity and decarbonisation.

“The Minister of Finance wrote to me earlier this year inviting suggestions for Productivity Commission inquiry topics. I’m pleased to be able to bring the important issue of carbon intensity to his and the Commission’s attention,” said Dr Norman.