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Emissions trading scheme

Terms of Reference of the Transport Fuels Technical Advisory Group

As at February 2008
For the New Zealand Emissions Trading Scheme

Purpose

This document sets out the terms of reference for a Transport Fuels Technical Advisory Group.  This group is being established to participate in the development of the liquid fossil fuel regulations of the New Zealand Emissions Trading Scheme, Climate Change (Liquid Fossil Fuel) Regulations 2008 (The Regulations).  The Climate Change (Emissions Trading and Renewable Preference) Bill (‘the Bill’) contains obligations for participants in the liquid fossil fuel sector from 1 January 2009.  Regulations will set out methodologies for participants to monitor and calculate their emissions from liquid fossil fuels. 

Background

When enacted, the Climate Change (Emissions Trading and Renewable Preference) Bill (the Bill) will create obligations for participants in the liquid fossil fuel sector who undertake the activities described in part 2 of Schedule 3 from 1 January 2009.  The Bill will also enable persons who purchase jet fuel in excess of 10 million litres per year to become participants should they wish to, thereby taking on all of the obligations associated with the jet fuel they purchase.  This is provided for in Part 3 of Schedule 4 of the Bill. 

The mandatory participants are expected to include at least 5 oil companies (BP, Caltex, Gull, Mobil and Shell) and possible voluntary participants, the 3 airlines.  Participants are also expected to include a small number of other firms who import fuel directly of more than 50 thousand litres per year, such as for racing activities.

The Regulations will set out which liquid fossil fuels are covered by the scheme and the methodologies for participants to monitor and calculate their emissions from those fuels.  They will also sets out methodologies for participants who opt-in in respect of jet fuel use to monitor and calculate their emissions.

Specifically the methodologies of the ETS for mandatory and voluntary liquid fossil fuel participants will cover:

The Regulations will be authorised through new section (Section 148) of the Climate Change Response Act 2002 which is to be inserted by way of clause 43 of the Bill.

The Regulations need to be promulgated as early as possible after the enactment of the Bill to allow participants adequate time to get their systems and procedures in place before the start date of 1 January 2009.  It is expected that the ETS Bill will be enacted in the middle of next year, and therefore the Regulations containing the methodologies need to be in a finalised state ready for promulgation at the same time.  Finalisation of the methodologies during the first half of next year is critical.  The existence and support of a liquid fossil fuels advisory group is an important part of this process.

Terms of Reference

The General Manager of the Emissions Trading Group (‘ETG’) is establishing a Transport Fuels Technical Advisory Group (‘TF TAG’) to act as the principal tool for engaging with the liquid fossil fuel supply sector on the draft content for the Climate Change (Liquid Fossil Fuel) Regulations 2008.  The TF TAG will comprise technical and policy specialists from the liquid fossil fuels supply sector and government.  The goal is to ensure that the NZETS functions in a sensible and practical manner for the liquid fossil fuel sector.

Membership

The TF TAG will comprise approximately twelve technical and policy experts from within industry, government, and the technical community, with a Chair appointed by the General Manager ETG.  Membership will include:

All members of the TF TAG, will be appointed by the General Manager of the ETG.  These members will be selected to provide specific technical and/or policy expertise rather than to represent particular interests or interest groups.

Role

The primary role of the TF TAG will be to:

  1. Provide a review of the NZ ETS methodologies for the liquid fossil fuel sector.
  2. Identify any issues contained in the NZ ETS methodologies for the liquid fossil fuel sector and make recommendations on how to resolve issues.
  3. Respond to issues presented to it by the ETG during the course of the finalisation of the NZ ETS methodologies for the liquid fossil fuel sector.
  4. Participate in a series of meetings to discuss the NZ ETS methodologies, that will include at least the following meetings:
    • Following the public release of the draft methodologies to take place before 31 March 2008, and
    • During the preparation of final methodologies in the form of regulations to take place before 30 June 2008.
  5. Assist the ETG with the preparation of reports that summarise the discussion and conclusions reached at each meeting. 
  6. Provide a review and comments on any additional work that is undertaken and that is coordinated by the ETG in response to specific issues arising.

In fulfilling its role, the TF TAG will uphold the broad NZ ETS core design/objectives. 

Secretariat

The TF TAG will be serviced by a special secretariat that will perform both an administrative role and an analytical role.  Administrative functions include:

  1. Coordinating TF TAG meetings and recording minutes;
  2. Compiling and distributing meeting papers;
  3. A general facilitation role and other roles as required by the Chair.

Deliverables

The TF TAG does not have any specific deliverables, although it will play a critical quality assurance role in the development of the summaries of the meetings held and any reports that may be required in response to issues that are raised after the draft methodologies are made public.  Its primary role is in the provision of advice to the ETG.

Information made available to the TF TAG or produced by TF TAG members will be made publicly available.  The ETG retains full rights to accept or reject the recommendations of the TF TAG.

Meeting Process

The following guidelines apply to meetings of the TF TAG:

  1. A quorum will be half the membership plus one member.
  2. Substitution of membership is allowable with the prior permission of the Chair.
  3. In the absence of the Chair of the TF TAG, the Chair will appoint an acting Chairperson who must be a member of the TF TAG.
  4. Members will notify the secretariat within a reasonable time frame if they are unable to attend a meeting.
  5. Meeting notes will be written in summary from and will not attribute any comments to any persons (Chatham house rules).
  6. Minutes of the meeting will be circulated to members within ten working days of the meeting.
  7. Once endorsed by the TF TAG, minutes of meetings will be publicly available.

Reporting

The Chair of TF TAG may be invited to report to the ETG from time to time.

Duration

The TF TAG will be deemed to have fulfilled its role upon the promulgation of the liquid fossil fuel regulations. 

Participation in good faith

The primary role of the TF TAG, is the provision of independent technical and policy advice.  Members are therefore expected to participate without prejudice to the policy outcome.  Members of the TF TAG are required to act in good faith and on a ‘no surprises’ basis.

Information prepared for the TF TAG or by the TF TAG will be of interest to member organisations and wider stakeholders.  Where information has been made available to members, they may only circulate it where prior approval has been obtained from the Chair.

Last updated: 15 September 2008