Climate Change Impact Report

Westpac NZ, Apr 2018: Click here to read the report.

Executive summary:

Westpac Group is committed to operating in a manner consistent with a two-degree future. Against this backdrop, Westpac NZ engaged EY to assess the climate change implications facing the New Zealand economy through to the middle of the century. This analysis comprised modelling the transitionary impacts of climate change under different ‘two-degree aligned’ scenarios, and conducting a literature review to develop an assessment of potential physical risks posed to different economic sectors under a range of climate scenarios. This report aims to provide long-term insights to inform Westpac NZ of the impact of climate change from a transition to a two-degree future and from the physical changes expected as climate change eventuates.

Key findings:

  • New Zealand can transition to a net zero emissions economy, under either scenario, while continuing economic growth.

  • Taking earlier, planned action on climate change under the central scenario is modelled to save NZ$30 billion in GDP growth by 2050 compared with the shock scenario, and results in a 32% lower carbon price by 2050.

  • Economic growth is not projected to be evenly distributed across sectors of the economy.

  • A sector’s ability to decarbonise is positively correlated with its potential for economic growth.

  • Agriculture faces decarbonisation challenges under both scenarios, but it benefits from an early and phased introduction into the New Zealand Emissions Trading Scheme (NZ ETS).

  • Technology and greenhouse gas (GHG) emissions constraints drive significant changes in the electricity sector.

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