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I've found a copy of the damaging headline about the National Leader that the Herald ran for hours. It would've been seen by thousands who may now withdraw support for him:

The Insidious Climate Denialism of Christopher Luxon

The headline was run simply because the Leader of the Opposition dared to oppose the transfer of $140 million of tax-payers money to NZ Steel to help pay for a new furnace to reduce emissions. Amazingly, as part of my little investigation into this affair, it emerges that the Green and Labour Parties have presided over a subsidy to NZ Steel specifically designed to increase the company's carbon emissions these past years. Gosh, maybe the Herald should start writing articles calling the Green Party a bunch of insidious climate deniers?

Yes, a world leading environment economics professor pointed out to me that Bluescope, which owns NZ Steel, has been given subsidized carbon credits - subsidized so heavily that they've been costing the company nothing - handed out to it for free. Stuff News reported in 2019, "The company receives about 90% of the carbon credits it needs for free from the Government" and that, "The largest recipient of free credits [in NZ] has been Australia's BlueScope Steel, which owns the Glenbrook Steel Mill south of Auckland. It has received credits worth $172m since 2010". Then in 2023 it was reported, "NZ Steel’s holding company Tasman Steel increased its profit by 153% to a bumper $340 million in the year to June while receiving free carbon credits worth $117m from the Government".

Hang on, that's a total $172m + $117m = $289 million in pollution subsidies, not even including 2020 and 2021. If you add the furnace subsidy announced yesterday, that makes a total $289 m + $140 m = $ 429 million. Including the subsidies obtained in 2020-21 would likely push the total NZ Steel has received to over HALF a BILLION dollars!

To summarize, a single company has been given (& continues to be given) in excess of $289 million to pollute more, supported by the Greens & Labour, and now is being given $140 million extra to install a technology to pollute less. And Chris Luxon is accused of being engaged in "insidious climate denialism" for trying to question the madness?


I did some work checking on the Herald's claim that not supporting the NZ Steel subsidy was an "insidious form of climate denialism" on behalf of the National Party leader by consulting with a world-leading environment economics professor. These are his comments:

First, since the Kiwi public are putting $140 million into NZ Steel (owned by Bluescope in Australia) for capital investment by the company, why didn't the government take an equity holding in the company and receive dividends for its investment?

Second, the claims made by the Herald that this subsidy would reduce emissions are probably bogus. Why? If NZ Steel was buying carbon credits as part of the Emissions Trading Scheme then it no longer needs to. That drop in demand would lower the market price for credits making it cheaper for others to pollute & not change total emissions.

Third, he alerted me to the fact that it appears NZ Steel has actually not been buying credits but has been given free credits by the Kiwi government, under the guise of making its exports more competitive. Stuff reports that Tasman Steel (the holding company owning NZ Steel) received "free carbon credits worth $117million from the Government" last year. Combined with the recent announcement of the $140 million subsidy, that amounts to total subsidies of one quarter of a billion dollars this past year and a half!

Fourth, since the free carbon credits NZ Steel received will now probably be ended, the Government will likely sell them back into the market and thereby increase supply, so the mechanism by which the carbon price falls will be more due to this increase in supply of credits than lower demand from NZ Steel. Either way, total emissions won't change.

So who is the Kiwi Tax Payer subsidizing? Well, NZ Steel's share-holders and folks in overseas countries who buy Kiwi "environmentally friendly" steel at a discounted price, courtesy of your money. The moral of the story is that before the Herald goes and insults the Leader of the Opposition for taking an "insidious" position on how to reduce emissions, maybe the newspaper could please work out what is actually going on.


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Robert MacCulloch

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