New Zealand will be $30 billion better off if it responds to climate change sooner rather than later, according to a report from Westpac.

Westpac commissioned research on moving to a low carbon economy that modelled two scenarios – one that involved an earlier and smoother transition to a lower carbon economy, and another in which action to reduce emissions was delayed for more than a decade.

The modelling suggests the economy would benefit by $30 billion by 2050 if government and businesses take early action. A key difference between the scenarios was the timing of the inclusion of agriculture within the NZ Emissions Trading Scheme (ETS).

“This research demonstrates the importance of taking immediate steps to cut our greenhouse gas emissions,” Westpac NZ chief executive David McLean said. “The alternative is waiting and taking action later, but that is likely to require more drastic changes in behaviour and over the long-term hit people harder in the pocket.”

McLean also said the finance sector has a major role to play in helping Kiwis transition to a low carbon economy. Westpac, he said, is stepping up its efforts to help curb climate change.

“Our lending to green businesses that are helping to provide solutions to climate change stands at $1.5 billion,” he noted. “We’ve set a new target to lift that to $2 billion by 2020. We’re also committing to reducing our own carbon emissions by another 25%.”

Since 2012, Westpac has decreased its own carbon emissions by 38% and reduced lending to companies involved in fossil fuel extraction and production by 55%.