The bill amends the Climate Change Response Act 2002 to remove agricultural activities from the New Zealand Emissions Trading Scheme, ending the scheduled requirements for processors and farmers to report and pay for agricultural emissions.
Parliament advanced this bill under urgency (first reading) — moving it through faster than usual, with less time than normal for public submissions.
These are claims MPs made in Parliament’s debate — not verified facts.
This bill amends the Climate Change Response Act 2002 to remove agriculture from New Zealand's Emissions Trading Scheme (ETS) - the system that puts a price on greenhouse gas emissions by making emitters buy and surrender units. Existing law contained a backstop: if no separate farm pricing system was in place, agricultural emissions would be drawn into the ETS, with meat, dairy and fertiliser processors liable for a levy from 2025 and on-farm reporting and payment following in later years. The bill repeals those provisions so that agricultural activities carry no ETS obligation, leaving industrial and energy emitters within the scheme. In practice, livestock and fertiliser emissions would not face an ETS charge, and the many thousands of farmers who might have had to register and report would not need to. It affects farmers, agricultural processors, and the design of climate policy for the sector responsible for close to half of the country's emissions.
Removing the ETS backstop reflects a coalition commitment to keep agriculture out of the ETS and instead pursue a separate, sector-specific approach; the government pairs it with funding for emissions-reduction technology and a stated goal of a fair and sustainable on-farm pricing system by 2030. Supporters argue the ETS is a blunt tool for biological methane, that pricing emissions without affordable ways to cut them would simply raise costs, shrink farm incomes and risk carbon leakage as production shifts to less efficient countries, and that a tailored system would work better. Opponents argue it removes the only firm obligation on the single largest source of the country's emissions, amounts to an open-ended delay with no guaranteed replacement, breaks the polluter-pays principle by shifting the burden onto other sectors and taxpayers, and puts international climate commitments at risk.
See the Parliament.nz ↗ site for the full bill.