Emissions: energy-intensive industries at risk from emissions trading

Emissions: energy-intensive industries at risk from emissions trading
Published: 12 March 2008

Holcim says the New Zealand Govt does not seem to fully appreciate the competitive risk many companies will face as a result of the proposed Emissions Trading Scheme. In a submission on the scheme, Holcim warns almost all energy-intensive manufacturing industries in NZ are trade-exposed to a significant degree. Most of these industries either export a substantial proportion of their production, or they are at serious risk of import competition from opportunistic overseas players, who can cherry-pick key metropolitan markets, with little or no investment of cash or jobs.  
 
It notes such opportunists will face no cost of carbon on their import tonnes, and will be able to effectively price NZ producers out of the market. The submission notes the degree to which many energy- intensive industries will be put at competitive risk by the scheme seems either "under-appreciated or under-regarded" by the Govt. It adds this is all the more remarkable when compared with the obvious importance given to the same issue in the case of agriculture. The submission warns the consequences will be a loss of jobs in NZ, increased social costs, loss of economic diversity and no net reduction in greenhouse gases, since the emissions will simply be produced in the country of origin.  Holcim says it agrees in principle with emissions trading and applauds the Govt’s decision to cover all sectors in the trading scheme, including agriculture. But the company suggests emissions trading for the liquid fuels sector be delayed until 2010, to match the entry of energy and industrial sectors in the scheme.