Uh oh: In New Zealand, the price of carbon dioxide hoax credits fell to 14 cents a ton last month

Carbon credit price meltdown | Stuff.co.nz

The cost of carbon credits fell to just 14 cents a tonne late last month, taking the annualised cost imposed on New Zealand business well below $10 million.

It is a far cry from the $25 a tonne forecast when the emissions trading scheme (ETS) was created.

The ETS, which mirrored schemes overseas, was designed to put a price on carbon to encourage reduced emissions of greenhouse gases. But carbon prices have collapsed, partly due to the economic crisis in Europe, and partly due to ETS changes designed to reduce the cost to business and keep the New Zealand economy competitive.

At 14 cents a tonne, the cost to New Zealand businesses has now become insignificant. Some market sources wonder if the costs of running the ETS are now greater than the cost to businesses of buying the carbon credits they need to surrender under the scheme.

Westpac's carbon dealing desk said certain imported European carbon credits can now be bought for 28 cents and emitters have to surrender only one credit each year for every two tonnes of carbon they emit.
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Just how high the cost of a single carbon credit should be is unknown, but Terry said former United Nations' climate chief, Yvo de Boer, recently said he believes the European Union needs to quickly boost its carbon price to about € 150 ($240) a tonne, if it is to meet its objective of reducing emissions to 80 per cent below 1990 levels by 2050. "Compared to this, present New Zealand pricing seems to be in make-believe land," he said.