30GB Regulations about limits and price control settings for units

(1)

The Governor-General may, by Order in Council made on the recommendation of the Minister, make regulations under this section.

(2)

If regulations are to be made under section 30GA, the Minister must recommend the making of regulations under this section that—

(a)

prescribe the following limits for a calendar year:

(i)

a limit on the New Zealand units available by auction (an individual limit); and

(ii)

a limit on the approved overseas units used (another individual limit); and

(iii)

a limit on the sum of the following (the overall limit):

(A)

the New Zealand units available by auction:

(B)

the New Zealand units available by other means:

(C)

the approved overseas units used; and

(b)

provide that—

(i)

the individual limits must not be exceeded; and

(ii)

the overall limit—

(A)

restricts both the New Zealand units available by auction and the approved overseas units used, in that neither must cause the overall limit to be exceeded; but

(B)

does not restrict the New Zealand units available by other means, in that they may cause the overall limit to be exceeded; and

(c)

provide that any additional units that are allocated under section 86C(5)(b) are not counted as New Zealand units available by other means; and

(d)

provide for how a reserve amount of New Zealand units is to be released for sale at auction if a trigger price is reached or exceeded by bidding at an auction, unless the reserve amount and minimum price are set at zero under paragraph (e); and

(e)

prescribe the following price control settings:

(i)

the reserve amount of New Zealand units for each trigger price, which may be a single reserve amount of zero:

(ii)

the 1 or more trigger prices, unless the reserve amount is zero:

(iii)

the minimum price below which units must not be sold by auction, which may be zero.

(3)

The Minister must recommend the making of regulations under this section so that,—

(a)

when the regulations are first made, they prescribe limits and price control settings for each of the next 5 or 6 calendar years; and

(b)

the regulations are amended to ensure that, at all times, they prescribe limits and price control settings for each of the next 5 calendar years.

(4)

Each time the Minister is to recommend that the regulations be amended to apply to a further calendar year under subsection (3)(b), the Minister—

(a)

must consider whether to recommend prescribing new limits and new price control settings for each of the 2 calendar years before that further calendar year; and

(b)

may recommend prescribing new limits and new price control settings for 1 or both of the 2 calendar years after the year in which the amendment is made.

(5)

However, the Minister may make a recommendation under subsection (4)(b) only if,—

(a)

in the year in which the amendment is made, the price control settings have had effect by—

(i)

the release of a reserve amount of units; or

(ii)

the sale of units at the minimum price; or

(b)

the Minister is satisfied that the amendment is justified by the following special circumstances:

(i)

a change that has significantly affected any matter that the Minister was required to consider under section 30GC when recommending the limits and price control settings that are to be amended; or

(ii)

a change in the budget or contribution described by section 30GC(2)(a) or (b) that applies to the year to which the amendment applies; or

(iii)

a force majeure event.

(6)

Regulations made under subsection (2)(a)(ii) may be made in respect of different units, transactions, persons, classes of units, subclasses of units, classes of transactions, or classes of persons.

(7)

See section 30GC for requirements relating to this section.

(8)

In this section,—

approved overseas units used means the number of approved overseas units used by participants in a calendar year by, for example, being transferred to holding accounts or being surrendered

New Zealand units available by auction means the number of New Zealand units sold by auction in a calendar year

New Zealand units available by other means means the number of New Zealand units that are allocated for eligible activities, or provided to participants under negotiated greenhouse agreements, in a calendar year.

Example

Regulations are first made under this section in December 2020. They must prescribe the individual limits, overall limits, and price control settings for the 5 (or 6) years from 2021 to 2025 (or 2026). In 2021, the regulations—

  • must be amended to apply (or in how they apply) to 2026; and

  • may be amended to prescribe new individual limits, overall limits, and price control settings for 2024 and 2025; and

  • may be amended to prescribe new price control settings for 2022 or 2023.

Section 30GB: replaced, on 23 June 2020, by section 50 of the Climate Change Response (Emissions Trading Reform) Amendment Act 2020 (2020 No 22).

Section 30GB(2)(e)(iii): replaced, on 15 March 2021, by section 5 of the Climate Change Response (Auction Price) Amendment Act 2021 (2021 No 4).