This country note features selected environmental indicators from the OECD Core Set, building on harmonised datasets available on OECD Data Explorer. The indicators reflect major environmental issues, including climate, air quality, freshwater resources, waste and the circular economy, and biodiversity. Differences with national data sources can occur due to delays in data treatment and publication, or due to different national definitions and measurement methods. The OECD is working with countries and other international organisations to further improve the indicators and the underlying data.
Environment at a Glance: New Zealand
New Zealand is a small, open and one of the most dynamic economies in the OECD. Population enjoys generally high living standards and environmental quality of life, with easy access to pristine wilderness and good air quality. The country is relatively sparsely populated. Natural resources have been a pillar of this growth, with agriculture, forestry, fishery and tourism accounting for a large share of gross domestic product (GDP) and exports. New Zealand is the world’s largest exporter of dairy products and sheep meat. The economy also has a sizable and expanding service sector, some large-scale manufacturing industries (notably aluminium and metal production, and food processing) and high-tech manufacturing. The diverse, and sometimes spectacular, landscapes underpin the growing film industry and tourism sectors.
New Zealand is a remote island state in the South Pacific Ocean, comprising two main islands (the North and South Islands) and many smaller islands. The terrain is predominantly mountainous, with some large coastal plains. Due to its geographic location and its natural history (which evolved in the absence of mammalian predators), New Zealand has a unique wealth of biodiversity, with one of the world’s highest rates of endemic flora and fauna species. The country is endowed with a wide variety of fossil fuels and renewable energy sources including iron ore, coal, gold, timber, natural gas, hydropower, sand and limestone, as well as fisheries. Its gas reserves are sufficient to entirely meet domestic consumption. The many rivers are swift and well suited to hydropower generation.
New Zealand managed to decouple economic growth from energy supply and production-based CO2 emissions since the mid-2000s. Despite a declining trend since 2005, the per person production-based and demand-based (or footprint) greenhouse gas (GHG) emissions remain above the OECD averages. Demand-based emissions are lower than production-based ones, meaning that New Zealand is a net exporter of GHG emissions embodied in final demand.
New Zealand has an unusual emissions profile, with nearly half of its emissions coming from agriculture. This is the highest share in the OECD, reflecting the importance of agriculture, including food and livestock production, in the economy. Most of the agriculture-related emissions are biological emissions, mainly methane (CH4) from ruminant cattle (enteric fermentation) and nitrous oxides (N2O) from animal waste and fertilisers (OECD, 2017[1]).
The transport sector is the second source of emissions and is almost entirely dependent on oil as a fuel source. Industry is also a major contributor to New Zealand’s GHG emissions and is heavily reliant on fossil fuels (IEA, 2023[2]).
New Zealand is well-endowed with fossil-fuel resources and is a net exporter of coal, but imports most of its oil. Net production and consumption of natural gas has decreased in recent years. Owing to its location, New Zealand has the second-largest share of geothermal energy in the OECD after Iceland (OECD, 2023[3]).
New Zealand has a diversified energy mix, with significant production of both hydropower and geothermal. Although fossil fuels still provide just over half of total energy supply, the share of renewables has reached 44.4% in 2023 (among the highest in the OECD), and 87.7% of electricity output.
Unlike in most OECD countries, emissions of non-methane volatile organic compounds (NMVOCs), nitrogen oxide (NOx) and sulfur oxide (SOx) have not decreased in the last two decades and even increased slightly. Emission intensities, both per person and per unit of GDP, are well above the OECD average.
By contrast, population exposure to PM2.5 is low by international comparison, and is slightly above the World Health Organisation threshold of 5 mg/m3. Regional variations to exposure are also low.
Available data show that New Zealand is water-rich and, gross abstractions representing 3% of total renewable freshwater resources, water stress is not an issue.
By international standards, freshwater in New Zealand is both clean and in good supply. However, some aspects of water quality and quantity are deteriorating in areas dominated by intensive land use (CBD, 2022[4]).
Latest data (2000) indicate that about 80% of households are connected to a wastewater treatment plant and about half of these to advanced (tertiary) treatment.
Data on municipal waste are incomplete and show only waste disposed of at levied disposal facilities (landfills) in New Zealand. At about 680 kg/person/year in 2023, New Zealand per person municipal waste generation is well above the OECD average.
Although per person domestic material consumption (DMC) has been declining since 2000, it remains well above OECD average. On the other hand, unlike many OECD countries, per person material footprint has declined. Material productivity has been increasing since 2000 but remains well below OECD average. The importance of the agricultural sector shows in the material mix: unlike most OECD countries, biomass makes up the bulk of materials consumed.
Due to its relative isolation from continental landmasses, New Zealand has a high level of endemic biodiversity with an estimated 80 000 species of native animals, plants and fungi. Endemic species examples include all the frogs and reptiles, more than 90% of the insects, approximately 80% of vascular plants and a quarter of bird species. While little is known about many of New Zealand’s marine species, up to 80% of the country’s indigenous species are thought to occur in the marine environment, around 44% of which are thought to be endemic.
Since the 1970s, decreases in population sizes of species have been largely caused by the significant impacts of introduced invasive alien species. Since New Zealand’s native species evolved in the absence of any native land mammals, they are particularly vulnerable to the impacts of introduced predatory mammal species (CBD, 2022[4]).
New Zealand has a large forest area and an almost as large part of the land is used for agriculture and livestock.
The country already achieved the 2030 GBF target (under the Convention on Biological Diversity) of protecting 30% of terrestrial and inland water areas, and of marine and coastal areas. However, the share of terrestrial areas designated under strict management objectives (IUCN categories I and II) is very low.
This section shows selected policy instruments based on data available for most OECD countries and does not provide a complete overview of countries’ policy mix to achieve their environment-related objectives. Interpretation should consider the country specific context.
The share of environmentally-related tax revenues in GDP is below the OECD average and has been declining (in line with the OECD area) to reach a low of 1.2% in 2022. The share in total revenues is also low. Like most countries, the energy tax base is the largest, followed by transport.
The New Zealand Government provides some incentives for fossil-fuel production by allowing certain exploration and development expenditures to be amortised for tax purposes over a shorter period than the productive life of the asset. This measure can result in an asymmetry of treatment compared with other industries, but its impact appears to be minor. On the consumer side, off-road users of gasoline, LPG, and compressed natural gas (e.g. in the farming sector) can obtain refunds for payments under New Zealand’s motor-spirits excise duty. This is because all revenue from the excise duty is directed towards road construction and maintenance. In 2019, majority of support for the oil industry was withdrawn together with the banning of new offshore oil exploration permits enacted in 2018.
In March 2022, in response to the spiking in energy prices, the Government has decided to temporarily reduce fuel excise taxes and road user charges July 2022. A simultaneous measure halving public transport fares was also announced, to be in effect for three months (OECD, 2023[3]).
In total, 44.7% of GHG emissions in New Zealand were subject to a positive Net Effective Carbon Rate (ECR) in 2023. Explicit carbon prices in New Zealand consist of emissions trading system (ETS) permit prices, which cover 44.5% of GHG emissions in CO2 eq. Fuel excise taxes, an implicit form of carbon pricing, cover 22.9% of emissions in 2023. About 7% of GHG emissions have a Net ECR above EUR 60 per tonne of CO2 eq., a mid-range estimate of current carbon costs. Net Effective Carbon Rates are highest in the road transport sector, which accounts for 15.4% of the country's total GHG emissions. The Net ECR is on average positive in all sectors (OECD, 2024[5])..
The share of environmentally-related government R&D budget in total budget has decreased but remains high compared to most OECD countries. The share of renewables in public energy RD&D is also relatively high.
New Zealand is a minor player in environmentally-related inventions, with per person inventions and share of environmentally-related inventions below the OECD average.
New Zealand’s development co-operation primarily focuses on small island developing states (SIDS) in the Pacific region. It seeks to support the social, environmental, economic, and stability and governance pillars of the 2030 Agenda for Sustainable Development. New Zealand’s total official development assistance (ODA) increased in 2024 to USD 780.8 million (preliminary data), representing 0.32% of gross national income (GNI).
In 2022-23, New Zealand committed 53.4% of its total bilateral allocable ODA in support of the environment and the Rio Conventions, up from 38.6% in 2020-21. The DAC average was 39% in 2022-23. Twenty per cent of screened bilateral allocable ODA focused on environmental issues as a principal objective, compared with the DAC average of 9.6%. Forty-seven per cent of total bilateral allocable ODA focused on climate change overall, up from 28.2% in 2020-21 (the DAC average was 34.8%). New Zealand had a greater focus on adaptation (47.1%) than on mitigation (29.4%) in 2022-23. Sixteen per cent of screened bilateral allocable ODA focused on biodiversity overall, up from 4.8% in 2020-21 (the DAC average was 7.6%). New Zealand committed USD 29.1 million in support of the conservation and sustainable use of the ocean in 2023, USD 6.2 million more than in 2022. The 2023 value is equivalent to 6% of New Zealand’s bilateral allocable ODA. (OECD, 2025[6]).
References
[4] CBD (2022), Country profiles: New Zealand, https://www.cbd.int/countries/profile?country=nz.
[7] Hockings, M. and E. al (2006), Evaluating Effectiveness. A framework for assessing management effectiveness of protected areas. 2nd Edition, IUCN, https://portals.iucn.org/library/efiles/documents/PAG-014.pdf.
[2] IEA (2023), New Zealand 2023 Energy Policy Review, OECD Publishing, Paris, https://doi.org/10.1787/d99c3085-en.
[6] OECD (2025), Development Co-operation Profiles, OECD Publishing, Paris, https://www.oecd.org/en/publications/development-co-operation-profiles_04b376d7-en/new-zealand_31b7d07e-en.html.
[5] OECD (2024), Pricing Greenhouse Gas Emissions 2024: Gearing Up to Bring Emissions Down, OECD Series on Carbon Pricing and Energy Taxation, OECD Publishing, Paris, https://doi.org/10.1787/b44c74e6-en.
[3] OECD (2023), OECD Inventory of Support Measures for Fossil Fuels: Country Notes, OECD Publishing, Paris, https://doi.org/10.1787/5a3efe65-en.
[1] OECD (2017), OECD Environmental Performance Reviews: New Zealand 2017, OECD Publishing, Paris, https://doi.org/10.1787/9789264268203-en.
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