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Landfills and the Emissions Trading Scheme

What is the Emissions Trading Scheme (ETS)?


The ETS, or the Scheme, was introduced in 2008 to address climate change. It helps New Zealand meet the international targets we have committed to as a country by putting a price on greenhouse gas emissions.

Through the Scheme, organisations can earn credits (called NZ units) for activities that absorb carbon dioxide (carbon dioxide is the main type of greenhouse gas).

To make up for greenhouse emissions they generate, organisations also pay for credits through the Scheme or they can invest in activities to reduce their greenhouse gas emissions. Each year, units tend to increase in value as the amount of units available is restricted by the government.

This in turn encourages businesses to lower their emissions through innovation and development of low-emission technology. The Scheme means New Zealanders may pay a higher price for some goods and services because the cost is passed onto their customers.

NZUs = NZ Units (carbon credits). Source: MFE 2018. Improvements to the NZ Emissions Trading Scheme: Consultation document.

Landfills and the ETS

In 2013, organisations that own landfills were included in the Scheme. This is because when the organic waste in a landfill, collected from businesses and the community, breaks down it naturally produces landfill gas – which is made up of a number of gases, including methane, a greenhouse gas.

To significantly reduce greenhouse gas emissions from our landfills, WM New Zealand invests heavily in technology and infrastructure, which enables us to capture over 90% of the landfill gas.

This is then either converted into electricity to supply homes and businesses across New Zealand or destroyed to stop it from entering the atmosphere. We also purchase credits through the Scheme for any landfill gas that is not captured from our landfills.

What does this mean for you?

WM New Zealand passes on to you the cost of purchasing credits through the Scheme and the cost of capturing and destroying greenhouse gas, for your waste.

By capturing over 90% of the landfill gas, the number of credits we have to purchase through the Scheme is reduced. So instead of purchasing a larger number of credits, we use our funds to invest in the construction, maintenance, and technology needed for our landfills to prevent most greenhouse gases from entering the atmosphere in the first place.

At landfills not owned and operated by WM New Zealand, the landfill operator will purchase the required credits through the Scheme and pass this on to WM New Zealand, which will be included in your disposal charges.

How a typical Landfill & Energy Park works

What does this mean for the planet?

Our Landfill & Energy Parks continue to be world leaders in protecting the environment from climate change by capturing most of the greenhouse gas that is created from your waste.