Zero Carbon Act to give businesses 'a pathway' to investment - James Shaw

Greens leader James Shaw says a new legally binding environmental target will "unlock a whole lot of economic activity" from businesses and help them make investment decisions.

Mr Shaw, who has taken up the role of Climate Change Minister in the new Government, is set to announce the finer details of the Zero Carbon Act in the next few months.

He told The AM Show the targets will be unveiled in the new Government's first 100 days, and enshrined in law at some point in 2018.

"We're very keen [to get environmental targets into law], and in fact all three parties of this Government have the idea that there will be a binding target to become carbon-neutral by the year 2050," he said.

"The actual legislation will come through next year. We want to do a good job of it, so we need to make sure we consult widely and so on, but we are going to introduce the target in our first 100 days."

Mr Shaw says the introduction of a Zero Carbon Act will "give the economy a pathway" to reaching the targets set, and "make it more predictable" when businesses make investment decisions.

"A lot of large companies have said to me they're actually holding back investment because they don't know which way this is going to go, so setting a binding target in law, with a 33-year pathway to get there, means some of those investment decisions can now be made," he said.

"I see that as really good news, because it will actually unlock a whole lot of economic activity in a particular direction."

Mr Shaw says the Emissions Trading Scheme - the legislation that currently holds businesses to account environmentally - is "a bit loose", and the prices "so low it hasn't actually incentivised anybody to change their behaviour".

He said over the course of the next three decades however, the price of not complying with the scheme will "creep up" and businesses will start "switching to more sustainable alternatives" as a result.

Another way the Greens are aiming to get New Zealand carbon-neutral is by minimising the up-front cost of electric cars. Mr Shaw says while the savings on petrol prices are huge - about a third of the cost - the initial price of the vehicles is prohibitive.

"Prior to the election we were really strong on this: we want to ensure that the up-front cost of the vehicle comes down for the average Kiwi," he said.

"For my colleague Julie Anne Genter, who has the Associate Transport portfolio, that's one of the things she'll be looking at - exactly how do we bring that price down for the average user?"

Mr Shaw says he gets driven round in an electric vehicle, and by 2025, every car in the Crown fleet will run on electric power.

An initiative to plant 1 billion trees over the course of the next decade has been delayed, Mr Shaw says, because they need to find suitable nurseries to begin planting. He says that will kick off next year.