ETS begins, but NZ trucking prepared

Emissions trading begins today in New Zealand, but the nation's trucking operators are prepared

By Rob McKay | July 1, 2010

Fuel prices may be up NZ3cents to NZ5cents a litre but New Zealand’s road haulage peak body is relatively relaxed about today’s introduction of an emissions trading scheme.

Meanwhile, the scheme’s impact will be felt in Australia, with NZ’s international logistics provider Mainfreight saying it will extend its pricing of emissions.

"We measure the carbon emissions we generate across Mainfreight New Zealand’s operation, and will establish measurement across our global operations beginning with Australia and the United States of America during 2010," the multinational company says in its annual report.

"We continue to lobby for the ability to move more freight by rail because the simple fact is trucks emit 4.6 times more CO2 per tonne km carried than trains.

"It is critical for the wealth and productivity of New Zealand and the world that rail services improve to effect this goal through capital investment in rolling stock and infrastructure."

However, the company did admit that "identifying rail freight opportunities in Australia and the United States of America remains difficult".

While NZ households digest higher electricity - Prime Minister John Key has estimated it will cost them and extra NZ$3 a week - and some companies say they will move offshore, the NZ Trucking Association believes it has dodged the worst.

"Transport operators need to pass these costs on because this is another compliance tax from a scheme that only a few of the world's nations are paying lip service too," NZTA says.

"Fortunately the Road Transport Forum has successfully reduced the impact on the commercial road transport sector by arguing against the enhanced scheme that Labour had proposed whilst they were the Government, and the actions of the current Transport Minister who is looking after the interests of ordinary New Zealanders."

Transport companies have already sought to mitigate the extra costs in ways that may be seen in Australia if Prime Minister Julia Gillard is successful in putting a price on carbon.

The Otago Daily Times quoted Dunedin transport operator Peter Sutherland as saying most companies had a formula to pass on fluctuating diesel costs to consumers and that "the formula would be adjusted to meet the ETS".

Local ship owner Pacifica Shipping has added an initial NZ$6 a teu depending on the value of carbon credits traded on the international market and on any future government decisions on fixing unit prices.

"Until the end of 2012, one emission unit will pay for every two tonnes of greenhouse gas emitted," Pacifica says.

"After this, the ratio will be one for one, with units traded on the international carbon market.

"Our fuel supplier is purchasing carbon credits through the European Climate Exchange and uses the ECX CER Daily Futures Contracts Spot rate."

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