Government faces lawsuit for keeping a lid on price of gas, petrol
A group of climate-concerned lawyers is suing the Government, alleging ministers acted in breach of their own climate laws. In December, the Government chose to keep a lid on the carbon price , contrary to advice from the Climate Change Commission. The commission recommended that the carbon price be given a longer rein, which could have raised petrol, gas and electricity costs. Although Climate Change Minister James Shaw backed the commissions advice, Cabinet led by then-Prime Minister Jacinda Ardern rejected the move. Lawyers for Climate Action want that decision to be reviewed in court, and declared unlawful. The lawyers note that the Climate Change Response Act which was reformed after the Labour Government took power requires that decisions affecting the carbon price align with domestic targets, the countrys international promises and the goal to reach net-zero by 2050. By only allowing small inflation-linked adjustments to the carbon price, the Government failed to meet that legal requirement, the lawyers argue. In December, the Government chose to follow some but not all the commissions advice on the Emissions Trading Scheme (or ETS). The commission itself said its recommendations should be treated as a cohesive package. The Government does not choose the carbon price directly, but uses settings to determine an appropriate price range. In reforming the ETS in 2019, it intended to create a steadily rising carbon price, which would encourage businesses and individuals to switch to cleaner energy. The Government chooses an upper and lower boundary within which the carbon price should stay each year. As part of this, it decides how many carbon units to sell at quarterly auctions each unit represents one tonne of emissions. The Government also determines how many units sit in a reserve pool to be released when auction bids go above the upper price boundary. Lawyers for Climate Action claim the Government failed to determine if the settings they chose last December aligned with domestic and international climate targets. The commission advised the Government to reduce the number of units it planned to auction between this year and 2027. Ministers decreased auction amounts, though not to the degree the commission recommended. The commission also wanted the Government to significant lift the upper price boundary and divide the reserve pool in two (some reserve units would be sold when bids went above $171 per tonne and the rest when bids exceeded $214). On that basis, the commission also suggested increasing the number of units in the reserve pool. The Government did not significantly lift the upper price, nor did it split the reserve pool. But it did increase the number of units in the reserve. Compared to the commissions recommendations, the Government essentially made 35 million units available at low prices during the next five years of auctions, Lawyers for Climate Action said. James Every-Palmer KC said ministers took a mix and match approach, following parts of the commissions advice. That made the decision incoherent. The Government failed to analyse whether these settings would meet its targets, he added but by law, the Climate Minister must be satisfied of this. It seemed to be what was cobbled together by a Cabinet, which was thinking about climate change, but more worried about the cost of living. A judge could declare the Governments current settings were unlawful and send officials back to the drawing board, Every-Palmer said. Every-Palmer hoped to get a judicial hearing prior to the Governments next decisions on the ETS . Lawyers for Climate Action previously challenged the Climate Change Commission in court. The court rejected the lawyers argument that the commissions carbon-cutting plan was insufficient ambitious and unlawful. The lawyers are appealing that ruling. Our weekly email newsletter, by the Forever Project's Olivia Wannan, rounds up the latest climate events. Sign up here .