The Emissions Trading Scheme (ETS) has created a lot of debate since it was first mooted in 2005.

Most of the science points to climate change happening; and it’s one of those issues where if you wait to be 100% sure it will be too late to do anything about it.

To reduce the amount of carbon in the air, we need to grow more trees and burn less fossil fuel. The Emissions Trading Scheme (ETS) is designed to encourage both of those.

There are a few key points about the ETS.

The ETS is not a tax – the government is seeking no revenue from it. It’s a system where those that store carbon (foresters), get to sell credits and make money off those that emit carbon who have to buy credits (big factories, cars that use petrol and diesel, thermal electricity generators). The government’s scheme is designed to be revenue neutral over time.

If we canned the ETS, foresters would cut down more trees, and fossil fuel use would climb. The country would fail to meet its Kyoto target and remain set up to use more carbon rather than less. Our trade would likely suffer with European consumers rejecting our goods.

The ETS will be  reviewed again in 2011 and regularly thereafter. Sectors like agriculture won’t enter the scheme unless our trade partners make progress on climate change.

New Zealand is a small country that is dependent on trade. If we don’t take climate change seriously then we risk trade barriers that harm our exports – especially from countries where consumers take climate change seriously, like the UK and Europe.

The National Government’s ETS is HALF the cost of Labour’s – half the impact on fuel prices and power prices, and half the cost to families – and we’ve delayed agriculture coming into the ETS until 2015

We’re going ahead with a scaled-back ETS now because when Labour’s original scheme went through, the Crown committed to handing out hundreds of millions of dollars of credits to foresters to encourage them to grow trees. If we don’t balance that with credits collected, taxpayers will have to foot the bill.

Australia’s approach of delaying their ETS and using other policy approaches does not work for New Zealand because foresters are already in our scheme receiving credits. Also, our clean and green brand and consumer exports are more vulnerable than Australia’s mining-dominated exports.

The ETS will cost the average household around $165 a year, or a little over $3 a week. The question is; are you prepared to pay $3 a week as an insurance policy for our environment?